toc—financial statements · 2021. 2. 26. · table of contents toc—financial statements notes...

Table of ContentsTOC—Financial Statements

UNITEDSTATESSECURITIESANDEXCHANGECOMMISSION

Washington,D.C.20549______________________________________________________________________________________

FORM10-K☑☑ANNUALREPORTPURSUANTTOSECTION13OR15(d)OFTHESECURITIESEXCHANGEACTOF1934

ForthefiscalyearendedDecember31,2020or

☐☐TRANSITIONREPORTPURSUANTTOSECTION13OR15(d)OFTHESECURITIESEXCHANGEACTOF1934Forthetransitionperiodfrom_____to_____

Commissionfilenumber1-13953

W.R.GRACE&CO.(Exact name of registrant as specified in its charter)

Delaware 65-0773649(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

7500GraceDrive,Columbia,Maryland21044-4098(Address of principal executive offices) (Zip Code)

(410)531-4000(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:Titleofeachclass TradingSymbol(s) Nameofeachexchangeonwhichregistered

Common Stock, $0.01 par value per share GRA New York Stock ExchangeSecurities registered pursuant to Section 12(g) of the Act:

NoneIndicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☑ No ☐Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☑Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the

preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerginggrowth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of theExchange Act.

Large accelerated filer ☑ Accelerated filer ☐

Non-accelerated filer ☐ Smaller reporting company ☐

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revisedfinancial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control overfinancial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report Yes ☑ No ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☑The aggregate market value of W. R. Grace & Co. voting and non-voting common equity held by non-affiliates as of June 30, 2020 (the last business day of the

registrant’s most recently completed second fiscal quarter) was $2,844,898,340.At January 31, 2021, 66,191,426 shares of W. R. Grace & Co. Common Stock, $0.01 par value per share, were outstanding.

DOCUMENTS INCORPORATED BY REFERENCEPortions of the definitive Proxy Statement to be delivered to our shareholders in connection with the registrant’s

2021 Annual Meeting of Shareholders, are incorporated by reference into Part III.


TABLEOFCONTENTS PARTIItem 1. Business 1Item 1A. Risk Factors 14Item 1B. Unresolved Staff Comments 24Item 2. Properties 24Item 3. Legal Proceedings 25Item 4. Mine Safety Disclosures 26

Information about our Executive Officers 27PARTIIItem 5. Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity

Securities 28Item 6. Selected Financial Data 30Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 31Item 7A. Quantitative and Qualitative Disclosures About Market Risk 56Item 8. Financial Statements and Supplementary Data 58Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 116Item 9A. Controls and Procedures 116Item 9B. Other Information 116PARTIIIItem 10. Directors, Executive Officers and Corporate Governance 117Item 11. Executive Compensation 117Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 117Item 13. Certain Relationships and Related Transactions, and Director Independence 117Item 14. Principal Accountant Fees and Services 117PARTIVItem 15. Exhibits, Financial Statement Schedules 118Item 16. Form 10-K Summary 121SIGNATURES 122


Notes on references that we use in this Report. Unless the context indicates otherwise, the terms “Grace,” the “Company,” “we,” “us,” or “our”mean (i) W. R. Grace & Co. itself, or (ii) W. R. Grace & Co. and/or one or more of its consolidated subsidiaries and affiliates and, in certain cases,their respective predecessors. Unless otherwise indicated, the contents of websites that we mention are not incorporated by reference or otherwisemade a part of this Report.

We refer to the Financial Accounting Standards Board as the “FASB.” The FASB issues, among other things, Accounting StandardsCodifications (which we refer to as “ASC”) and Accounting Standards Updates (which we refer to as “ASU”). We refer to the U.S. Internal RevenueService as the “IRS.”

Trademarks and other intellectual property that we discuss in this Report. GRACE , the GRACE logo (and any other use of the term “Grace”as a tradename) as well as the other trademarks, service marks, or trade names used in this Report are trademarks, service marks, or trade names,registered in the United States and/or other countries, of Grace or its operating units, except as otherwise indicated. UNIPOL and UNIPOLUNIPPAC® are trademarks of The Dow Chemical Company or an affiliated company of Dow. Grace and/or its affiliates are licensed to use theUNIPOL and UNIPOL UNIPPAC trademarks in the area of polypropylene. ART and ADVANCED REFINING TECHNOLOGIES are trademarks,registered in the United States and/or other countries, of Advanced Refining Technologies LLC. RESPONSIBLE CARE and RESPONSIBLE CAREMANAGEMENT SYSTEM are trademarks, registered in the United States and/or other countries, of the American Chemistry Council.Sustainalytics, a leading independent provider of ESG and corporate governance ratings, research and analysis, has provided the ESG Risk Ratingas set forth in the ESG Risk Rating Summary Report issued December 31, 2020.

FORWARD-LOOKINGSTATEMENTS

This Report contains, and our other public communications may contain, forward-looking statements, that is, information related to future, notpast, events. Such statements generally include the words “believes,” “plans,” “intends,” “targets,” “will,” “expects,” “suggests,” “anticipates,”“outlook,” “continues,” or similar expressions. Forward-looking statements include, without limitation, statements regarding future: financial positions;results of operations; cash flows; financing plans; business strategy; operating plans; capital and other expenditures; impact of COVID-19 on ourbusiness; competitive positions; growth opportunities for existing products; benefits from new technology; benefits from cost reduction initiatives;succession planning; and markets for securities. For these statements, we claim the protections of the safe harbor for forward-looking statementscontained in Section 27A of the Securities Act and Section 21E of the Exchange Act. We are subject to risks and uncertainties that could causeactual results or events to differ materially from our projections or that could cause other forward-looking statements to prove incorrect. Factors thatcould cause actual results or events to differ materially from those contained in the forward-looking statements include, without limitation: risksrelated to foreign operations, especially in areas of active conflicts and in emerging regions; the costs and availability of raw materials, energy andtransportation; the effectiveness of our research and development and growth investments; acquisitions and divestitures of assets and businesses;developments affecting our outstanding indebtedness; developments affecting our pension obligations; legacy matters (including product,environmental, and other legacy liabilities) relating to past activities of Grace; our legal and environmental proceedings; environmental compliancecosts (including existing and potential laws and regulations pertaining to climate change); the inability to establish or maintain certain businessrelationships; the inability to hire or retain key personnel; natural disasters such as storms and floods; fires and force majeure events; the economicsof our customers’ industries, including the petroleum refining, petrochemicals, and plastics industries, and shifting consumer preferences; publichealth and safety concerns, including pandemics and quarantines; changes in tax laws and regulations; international trade disputes, tariffs, andsanctions; the potential effects of cyberattacks; and those additional factors set forth under Item 1A. “Risk Factors” and elsewhere in this AnnualReport on Form 10-K. Our reported results should not be considered as an indication of our future performance. Readers are cautioned not to placeundue reliance on our projections and forward-looking statements, which speak only as of the dates those projections and statements are made. Weundertake no obligation to release publicly any revisions to our projections and forward-looking statements, or to update them to reflect events orcircumstances occurring after the dates those projections and statements are made.

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PARTI

Item1.BUSINESS

BUSINESSOVERVIEW

W. R. Grace & Co., through its subsidiaries, is engaged in the production and sale of specialty chemicals and specialty materials on a globalbasis through two reportable business segments: Grace Catalysts Technologies (“Catalysts Technologies”), which includes catalysts and relatedproducts and technologies used in petrochemical, refining, and other chemical manufacturing applications; and Grace Materials Technologies(“Materials Technologies”), which includes specialty materials, including silica-based and silica-alumina-based materials, used in pharma/consumer,coatings, and chemical process applications.

Historical Perspective

Grace is the successor to a company that began in 1854 and originally became a public company in 1953. We entered the specialty chemicalsand specialty materials industries in 1954, the year in which we acquired the Davison Chemical Company. W. R. Grace & Co. is a Delawarecorporation.

W. R. Grace & Co. conducts all of its business through a single wholly owned subsidiary, W. R. Grace & Co.–Conn. (“Grace–Conn.”), aConnecticut corporation formed in 1899. Grace–Conn. owns all of the assets, properties and rights of W. R. Grace & Co. on a consolidated basis,either directly or through subsidiaries.

Recent Developments

Acquisitions

We discuss our approach to Mergers and Acquisitions below, under “Profitable Growth Strategy.” In line with that strategy, in recent years wehave completed the following transactions:

We completed the acquisition of the business and assets of Rive Technology, Inc. (“Rive”) on June 17, 2019, for $22.8 million, with anadditional $2.0 million holdback payment remitted in the three months ended September 30, 2020. The business is included in the RefiningTechnologies operating segment of our Catalysts Technologies reportable segment. The acquisition included Rive’s MOLECULAR HIGHWAYzeolite technology for catalytic processes, which allows us to offer a broader spectrum of products for converting crude oil to petrochemicalfeedstocks.

On April 3, 2018, we acquired the assets of the polyolefin catalysts business of Albemarle Corporation for $418.0 million, net of cash acquiredand including customary post-closing adjustments. The acquisition included production plants in Baton Rouge, Louisiana, and Yeosu, South Korea;research and development and pilot plant capabilities; and an extensive portfolio of intellectual property. The business is included in the SpecialtyCatalysts operating segment of our Catalysts Technologies reportable segment. The acquisition was complementary to our existing SpecialtyCatalysts business and has strengthened our commercial relationships, catalysts technology portfolio, and manufacturing network.

On June 30, 2016, we completed the acquisition of the assets of the BASF Polyolefin Catalysts business for a purchase price of $250.6 million.The acquisition included technologies, patents, trademarks, and production plants in Pasadena, Texas, and Tarragona, Spain. The acquisitionadded the following technologies to our catalysts portfolio: (1) LYNX high-activity polyethylene (“PE”) catalyst technologies used commercially inslurry processes for the production of high-density PE resins such as bimodal film and pipe; and (2) LYNX polypropylene (“PP”) catalysttechnologies used commercially in all major PP process technologies including slurry, bulk loop, stirred gas, fluid gas, and stirred bulk. Theacquisition also provided us with significant additional flexibility and capacity for our global polyolefin catalysts manufacturing network. Theseproducts became part of the Specialty Catalysts operating segment of our Catalysts Technologies reportable segment.

We completed the acquisition of the assets of the Polypropylene Licensing and Catalysts business of The Dow Chemical Company onDecember 2, 2013, for a cash purchase price of $510.4 million (which included post-closing adjustments). The acquisition included UNIPOLPolypropylene Process Technology as well as CONSISTA and SHAC catalysts. The technology and products complemented our polyolefincatalyst

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businesses as part of the Specialty Catalysts operating segment of our Catalysts Technologies reportable segment. The acquisition also includedour production plant in Norco, Louisiana.

Other Notable Developments

In 2016, Grace completed a separation transaction with respect to GCP Applied Technologies Inc., then a wholly-owned subsidiary of Grace(“GCP”), which included Grace’s former Construction Products operating segment and the packaging technologies business of its MaterialsTechnologies operating segment (the “Separation”). The Separation was effected by means of a pro rata distribution to the Company’s stockholdersof all of the outstanding shares of GCP common stock. As a result of the transaction, GCP became an independent public company.

On February 3, 2014, Grace concluded a voluntary reorganization under Chapter 11 of the United States Bankruptcy Code in the United StatesBankruptcy Court for the District of Delaware, when the joint plan of reorganization (the “Joint Plan”) filed by Grace and certain other parties becameeffective.

Global Scope

We operate our business on a global scale with approximately 73% of our 2020 consolidated sales outside the United States. We operateand/or sell to customers in over 60 countries and in over 30 currencies. We manage our operating segments on a global basis, to serve globalmarkets. Currency fluctuations affect our reported results of operations, cash flows, and financial position.

Profitable Growth Strategy

We create value for customers and investors by profitably growing our specialty chemicals and specialty materials businesses and achievinghigh levels of efficiency and cash flow. To meet these objectives, we:

• Invest to accelerate growth and extend our competitive advantages;• Invest in great people to strengthen our high-performance culture;• Execute the Grace Value Model to drive operating excellence; and• Acquire to build our technology and manufacturing capabilities for our customers.

Our businesses are well-positioned to grow through our customer-driven innovation, commercial and operating excellence and thoughtful,disciplined merger and acquisition approach. Our businesses are interconnected through shared materials science and our highly integrated globalmanufacturing and supply chain operations.

Our organic growth drivers include: global demand for plastics and petrochemical feedstocks; global demand for cleaner fuels and heavy oilupgrading; rising living standards and growing middle class incomes; stricter environmental standards; and increased focus on health and wellness.

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The Grace Value Model (“GVM”)

The Grace Value Model is our framework for creating and delivering value to customers, investors and employees. At the company level, wecreate value through our focused portfolio, strong strategic position, and disciplined capital allocation. At the business level, we create value throughcustomer-driven innovation, commercial excellence, and operating excellence. Linking and enabling all of these elements are great talent, high-performance culture, and integrated business management processes. Our ability to rigorously execute the Grace Value Model is a principal sourceof our competitive advantage in the global marketplace and our financial performance. The Grace Value Model is illustrated as follows:

Human Capital Management

Our great talent and high-performance culture are the most important sources of our competitive advantage and long-term ability to delivervalue to customers and investors. We have invested heavily in our global talent and talent management system, which includes aligned goal setting,ongoing feedback and coaching, effective performance reviews, and a continuous cycle of professional development. We have also investedsignificantly in talent development and effectiveness, including over $6 million and 50,000 hours of commercial excellence investment and trainingfor our commercial teams since 2016. In 2019 and 2020, we refreshed more than 10% of our global workforce, including upgrading talent whereneeded and adding key leadership roles throughout the organization. Our voluntary workforce turnover rate was 5.4% in 2020.

Our high-performance culture is based on our commitment to performance and our five Grace Leadership Behaviors: Deliver Results; ThinkCritically; Be Authentic; Communicate; and Engage and Include. We expect our colleagues to model these behaviors and our values in their dailybusiness conduct and include behavior as a core element of our performance reviews.

We aspire to continually strengthen our talent and high-performance culture by welcoming and valuing the unique backgrounds, cultures,ethnicities, genders, experiences, perspectives, and contributions of our employees around the globe. We have a well-developed Diversity andInclusion strategy and a multi-year action plan to improve the diversity of our global team and ensure every employee feels included and valued.

Our diversity and inclusion strategy starts at the top: on the Grace Board of Directors, 29% of our independent directors are women, and on theGrace Leadership Team, 50% of our executives are women or people of color, including three of four business unit leaders. Increasing the diversityof our global team, including greater representation of women and under-represented minorities, is a focus. Through diversity and inclusion, westrengthen our people and our business.

The COVID-19 pandemic had a significant impact on our human capital management strategies and priorities in 2020. Aligned with our strongsafety culture, we developed clear and effective worksite safety protocols, updated policies to add flexibility, and provided personal protectiveequipment to protect our essential employees working onsite in our manufacturing plants, research laboratories, and quality control laboratories. Inaddition, we paid for COVID-19 testing globally and covered treatment in the U.S. Approximately 45% of our workforce worked from home for mostof 2020, following a seamless transition to remote work in March, including implementation of new communication and collaboration technology. Wereduced operating costs during the year,

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but were careful to protect our growth investments, maintain our focus on technology leadership, and continue our commercial excellence andoperating excellence initiatives. We made no layoffs or salary reductions and continued employee development and hiring of critical talent. Weexperienced very high levels of engagement and productivity throughout the year.

As of December 31, 2020, we employed approximately 4,000 employees with 2,200 employed in the United States and 1,000 employed inGermany.

Approximately 2,300 employees are salaried, and 1,700 employees are hourly. Approximately 700 of our manufacturing employees at 5manufacturing sites in the United States are represented by unions. We have operated without a labor work stoppage for more than 20 years.Outside the United States, we have works councils and unions serving approximately 1,400 employees, the majority of whom are located at ourEuropean sites.

Our Approach to Mergers & Acquisitions (“M&A”)

Our approach to M&A prioritizes strategic fit and financial returns. We seek investments that improve our technology, research anddevelopment and/or commercial capabilities; enhance and/or leverage our manufacturing capabilities; and include attractive growth and profitabilityopportunities. Our recent acquisitions have been very synergistic, with strong growth and returns driven by significant cost and capital synergies. Weestablish minimum return requirements for acquisitions, based on specific risk-adjusted hurdle rates, and expect all acquisitions to be accretive toearnings per share (“EPS”).

Our Reportable Business Segments

GRACECATALYSTSTECHNOLOGIES

Catalysts Technologies uses our significant catalysts knowledge and applications expertise to design and manufacture products to createsignificant value for our customers. Our customers include plastics and chemicals manufacturers as well as oil refiners. We believe that ourtechnological expertise and broad technology platform provide a competitive advantage, allowing us to quickly design products that help ourcustomers create value in their operations and their end markets.

The following table sets forth Catalysts Technologies sales of similar products as a percentage of Grace total revenue.

YearEndedDecember31,2020 2019 2018

(Inmillions) Sales%ofGraceRevenue Sales

%ofGraceRevenue Sales

%ofGraceRevenue

Polyolefin and chemical catalysts $ 621.6 35.9 % $ 705.3 36.0 % $ 661.5 34.2 %Refining catalysts 649.8 37.6 % 791.4 40.4 % 802.0 41.5 %Total $ 1,271.4 73.5 % $ 1,496.7 76.4 % $ 1,463.5 75.7 %

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A description of our Catalysts Technologies products and services and their applications follows:

ProductsandServices Overview/Use KeyBrandsPolyolefin and Chemical Catalysts (alsoreferred to as Specialty Catalysts)Polyethylene Catalysts/PolypropyleneCatalysts/Catalyst Supports

Used in the production of polyethylene (PE) and polypropylene(PP) thermoplastic resins, which can be customized to enhance theperformance of a wide range of industrial and consumer end-useapplications including high pressure pipe, geomembranes, foodpackaging, automotive parts, medical devices, and textiles; non-phthalate catalysts allow customers to produce phthalate-free PPproducts and cleaner, clearer PP products; includes catalysts thatallow for the lightweighting of automobiles by replacing steel partswith PP while meeting demanding performance standards ofautomakers

PE Brands -MAGNAPORE • SYLOPOL • LYNX PP Brands -CONSISTA • SHAC • LYNX •POLYTRAK • HYAMPP

Gas-Phase Polypropylene ProcessTechnology Licensing

Provides licensees with a cost-effective, flexible, and reliablecapability to manufacture polypropylene products having a widespectrum of performance attributes, enabling customers tomanufacture products for a broad array of end-use applications

UNIPOL Polypropylene ProcessTechnology • UNIPOL UNIPPAC ProcessControl Software

Chemical Catalysts Include hydrogenation and dehydrogenation catalyst products usedin a variety of petrochemical chain conversions and fine chemicalproduction

RANEY • DAVICAT

Refining TechnologiesFCC Catalysts Crack the hydrocarbon chains in distilled crude oil to produce

transportation fuels, such as gasoline and diesel fuels, and feedsfor production of petrochemicals

MIDAS • IMPACT • NEKTOR™ •GENESIS • ACHIEVE • FUSION •VIP‑R™ •RIVE TECHNOLOGY •MOLECULAR HIGHWAY

FCC Additives Used to reduce sulfur in gasoline, maximize propylene productionfrom refinery FCC units, and reduce emissions of sulfur oxides,nitrogen oxides, and carbon monoxide from refinery FCC units

D-PRISM • GSR • SURCA • ZAVANTI™• OLEFINSULTRA • DESOX • DENOX •CP • OXYBURN

Hydroprocessing Catalysts (HPC) Marketed through the ART joint venture with Chevron (discussedbelow), these catalysts are used in process reactors to upgradeheavy oils into lighter, more useful products, enabling lessexpensive feedstock usage in the petroleum refining process, andto produce products that meet more stringent environmentalregulations; our catalysts and solutions allow our customers toimprove their profitability in the production of cleaner petroleum-based fuels to meet regulatory and fuel quality standards

ICR • HOP • SmART Catalyst System •APART • LS™Catalyst Platform •HSLS Catalyst Platform • HCRC™CatalystPlatform • DCS™Catalyst Platform •ECAD™Catalyst Platform • GR •ENRICH

Polyolefin and Chemical Catalysts (also referred to as Specialty Catalysts)

Grace Specialty Catalysts provides process technology for polypropylene and a broad range of high-performance catalysts and supports forspecialized processes in the chemical value chain, from plastics to petrochemicals.

We are the only fully integrated supplier of polyolefin catalyst solutions across all process and catalyst technologies. Our strong strategicposition is particularly evident in our worldwide polyolefin catalysts and process technology licensing business. After investing $1.2 billion inaccretive, synergistic acquisitions over the past seven years, including five new plants on three continents, we offer customers the broadest andmost technically advanced portfolio of polyolefin catalysts technologies that enable the production of high performance and differentiated resins.Polyolefin catalysts are used to produce plastics including HDPE (high density polyethylene), LLDPE (linear low density polyethylene) and PP(polypropylene). Applications include packaging, consumer/housewares, food packaging, construction, and automotive segments providingrecyclable, lightweight, durable and versatile materials.

The business comprises four major segments, including UNIPOL PP Process Licensing, PP Catalysts, PE Catalysts, and Chemical Catalysts.

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The UNIPOL PP Process Licensing provides plant design and operational technology to polymer producers. We are the largest independenttechnology licensor, offering the advantages of a gas-phase process with low capital cost, mechanical simplicity, energy efficiency, and thedemonstrated capability to produce differentiated resins. The UNIPOL Polypropylene Process Technology provides polypropylene producers withthe capability to innovate and succeed faster, as their business evolves to meet more sophisticated market needs. UNIPOL PP licensees also haveaccess to our tailored services, experienced technical team, and our Advanced Process Control software to improve their overall plant lifetimeperformance.

Our PP Catalysts serve multiple process technologies, including UNIPOL PP, with optimized sizes, shapes, and composition tailored for eachprocess requirement. We also offer unique external donor technologies that are combined with our catalysts, providing customers with resin productdifferentiation and production operability advantages.

Our PE Catalysts portfolio, with supporting R&D and technical service, offers existing producers the best choice of resin properties, operabilityand economics utilizing the three main types of Metallocene, Chromium, and Ziegler catalysts. Products include catalyst components and finishedcatalysts across all three systems and are offered as merchant products or custom developments.

Chemical Catalysts has two product lines: RANEY and DAVICAT . RANEY catalyst products are used in a broad range of nichehydrogenation applications such as butanediol, sorbitol, and amines. DAVICAT catalysts and catalyst carriers extend Grace-wide material scienceexpertise in silicas, aluminas, and zeolites into a number of petrochemicals and fine chemicals applications.

Refining Technologies

FCC Catalysts and Additives

We are a global leader in developing and manufacturing fluid catalytic cracking, or FCC, catalysts and additives that are designed to enablepetroleum refiners to increase profits by improving product yields, value and quality. Our FCC products also enable refiners to reduce emissionsfrom their FCC units and reduce sulfur content in the transportation fuels they produce. Oil refining is a highly specialized discipline, and FCCcatalysts must be tailored to meet local variations in crude oil feedstocks and a refinery’s desired product mix. We work regularly with our customersto identify the most appropriate catalyst and additive formulations for their changing needs.

FCC units are designed to produce a broad spectrum of refined product yields, including gasoline, middle distillates, and liquefied petroleumgas, or LPG. Traditionally, many FCC operators have focused on maximizing yields of transportation fuels. However, as demand for petrochemicalsincreases, a growing segment of refiners have transitioned their FCC operations with the primary objective of maximizing yields of petrochemicalfeedstocks, such as propylene. We maintain multiple industry leading technologies, including ZAVANTI™ and VIP-R™, that allow our customers tocapture unique value from petrochemical feedstock driven operations.

Many countries and regions, including the U.S., European Union, Japan, Russia, India and China have imposed regulatory limitations on thesulfur content of gasoline and diesel fuel. We have developed a portfolio of products designed to assist refiners in meeting their gasoline sulfur-reduction targets, including our D-PRISM and GSR additives and our SURCA catalyst family.

Also, many U.S. petroleum refiners have entered into consent decrees with the U.S. Environmental Protection Agency (the “EPA”) under whichthe refiners have agreed to reduce emissions of nitrogen oxides and sulfur oxides. The European Union has also imposed requirements onrefineries with respect to nitrogen oxides and sulfur oxides emissions. Our additives are designed to assist refineries in meeting their obligations toreduce these pollutants. Our Super DESOX additive reduces sulfur oxides emissions from commercial FCC units. Our DENOX additives aredesigned to achieve reductions in nitrogen oxides emissions comparable to those obtained from capital intensive alternatives available to a refinery,while our non-platinum-based combustion promoter CP P is designed to enable refiners to control carbon monoxide emissions without increasingnitrogen oxides. Our newly developed OXYBURN additives are used in the reduction of oxygenates which are often a problem when co-processingrenewable feedstocks in FCC units.

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Hydroprocessing Catalysts

We market most of our hydroprocessing catalysts through our Advanced Refining Technologies LLC (“ART”) joint venture with ChevronProducts Company (“Chevron”). We hold a 50% economic interest in ART, which is not consolidated in our financial statements so ART’s sales areexcluded from our sales. We established ART to combine our technology with that of Chevron and to develop, market, and sell hydroprocessingcatalysts to customers in the petroleum refining industry worldwide.

We are a leading supplier of hydroprocessing catalysts designed for processing high resid content feedstocks. We offer products for fixed-bedresid hydrotreating, on-stream catalyst replacement, and ebullating-bed resid hydrocracking processes.

We also offer a full line of catalysts, customized for individual refiners, used in distillate hydrotreating to produce ultra-low sulfur contentgasoline and diesel fuel, including our SmART CATALYST SYSTEM and APART Catalyst Systems. As discussed above, regulatory limitations onthe sulfur content of gasoline and diesel fuel are becoming more common. These products are designed to help refiners to reduce the sulfur contentof their products.

Our ENRICH catalysts, which are marketed by Grace rather than ART, enable the coprocessing of bio-based feedstocks at refineries.

We have rights to sell hydrocracking and lubes hydroprocessing catalysts to licensees of Chevron Lummus Global (“CLG”) and otherpetroleum refiners for unit refills. These rights allow us to streamline hydroprocessing catalyst supply and improve technical service for refiningcustomers by establishing ART as their single point of contact for all their hydroprocessing catalyst needs.

Manufacturing, Marketing and Raw Materials

Our Catalysts Technologies products are manufactured by a network of globally coordinated plants. Our integrated supply chain organization isresponsible for the effective utilization of our manufacturing capabilities. For a discussion of our manufacturing plants for Catalysts Technologies,see Item 2, “Properties,” below.

We use a global organization of direct sales professionals to market our polyolefin catalysts, polypropylene process technology, and chemicalcatalysts, that seeks to maintain close working relationships with our customers. Our global direct sales force is complemented by a network ofdistributors and agents in Asia Pacific and, to a lesser extent, the Americas and Middle East. These relationships enable us to cooperate with majorpolymer and chemical producers to develop catalyst technologies that complement their process or application developments. We havegeographically distributed our sales and technical service professionals to make them responsive to the needs of our geographically diversecustomers. We typically operate under long-term contracts with our customers.

We use a global organization of technical professionals, including a direct sales force, with extensive experience in refining processes, catalystdevelopment, and catalyst applications to market our refining catalysts and additives. These professionals work to tailor our technology to the needsof each specific customer. We generally negotiate prices for our refining catalysts because our formulations are specific to the needs of eachcustomer and each customer receives individual attention and technical service. We sell a significant portion of our hydroprocessing catalyststhrough multiple-year supply agreements with our geographically diverse customer base.

The principal raw materials for Catalysts Technologies products include molybdenum oxide, specialty inorganics, caustic soda, alumina andderivatives, sodium silicate, nickel, rare earths, solvents, and titanium tetrachloride. Multiple suppliers are generally available for each of thesematerials; however, some of our raw materials may be provided by single sources of supply. We seek to mitigate the risk of using single sourcesuppliers by identifying and qualifying alternative suppliers or, for unique materials, by using alternative formulations from other suppliers. In someinstances, we produce our own raw materials and intermediates.

Prices for many of our raw materials, including metals, and energy can be volatile. In response to increases in raw materials and energy costs,we generally take actions to mitigate the effects of higher costs including developing alternative formulations for our products, increasingproductivity, hedging purchases of certain raw materials, and increasing prices.

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As in many chemical businesses, we consume significant quantities of natural gas in the production of Catalysts Technologies products. Worldevents and other economic factors cause volatility in the price of natural gas. Increases or decreases in the cost of natural gas and raw materialscan have a significant impact on our operating margins. We have implemented a risk management program under which we hedge natural gas in away that is designed to mitigate the effects of price volatility.

Seasonality

Seasonality does not have a significant overall effect on our Catalysts Technologies reportable segment. However, under traditional patterns,sales of FCC catalysts have tended to be lower in the first calendar quarter due to maintenance outages taken prior to the shift in production byrefineries from home heating oil for the winter season to gasoline production for the summer season. FCC catalysts and ebullating-bedhydroprocessing catalysts are consumed at a relatively steady rate and are replaced regularly. Fixed-bed hydroprocessing catalysts are consumedover a period of years and are replaced in bulk in an irregular pattern. Since our customers periodically shut down their refining processes to replacefixed-bed hydroprocessing catalysts in bulk, our hydroprocessing catalyst sales to any customer can vary substantially over the course of a year andbetween years based on that customer’s catalyst replacement schedule.

Backlog of Orders; Working Capital

While at any given time there may be some backlog of orders, this backlog is not material in respect to our total annual sales for CatalystsTechnologies, nor are the changes, from time to time, significant. Our working capital consists of inventory, accounts receivable, accounts payable,and deferred revenue. We closely manage these working capital accounts. We value inventory balances under the first-in, first-out (“FIFO”) method.Inventories have turned regularly, but balances typically increase during the first half of the year before declining as a result of increased sales in thesecond half. Accounts receivable and accounts payable are also affected by this business cycle, typically requiring us to have greater workingcapital needs during the second and third quarters.

Competition

Competition in the polyolefin catalyst, catalyst supports, and polypropylene process licensing industry is technology-intensive. Our competitionin this industry includes Univation, LyondellBasell, PQ, and Lummus Novolen Technology. Most competitors sell their products and/or license theirtechnology worldwide.

Competition in FCC catalysts and additives and hydroprocessing catalysts is based on value delivered to refiners, which is based ondifferentiated technology, catalyst performance, technical and customer service, and price. Our principal global FCC catalyst competitors areAlbemarle, BASF, and SINOPEC. Our principal global competitors in FCC additives are Johnson Matthey, Albemarle, and BASF. Our principalglobal competitors in hydroprocessing catalysts are Shell Catalysts (formerly Criterion), Albemarle, Haldor Topsoe, UOP, and Axens. We also havemultiple regional competitors.

GRACEMATERIALSTECHNOLOGIES

Materials Technologies uses our significant specialty silica, zeolite and fine chemical knowledge and applications expertise to design andmanufacture products to create significant value for our customers. Our customers include pharmaceutical companies, consumer productsmanufacturers, coatings manufacturers, emission control system manufacturers, petrochemical and natural gas processors, and plasticsmanufacturers. We believe that our technological expertise and broad technology platform provide a competitive advantage, allowing us to tailor ourproducts to specific customer requirements and help them create value in their operations and end markets.

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The following table sets forth Materials Technologies sales of similar products as a percentage of Grace total revenue.


(Inmillions) Sales%ofGraceRevenue Sales

%ofGraceRevenue Sales

%ofGraceRevenue

Pharma/Consumer $ 162.5 9.4 % $ 144.6 7.4 % $ 132.6 6.9 %Coatings 137.5 8.0 % 139.8 7.1 % 155.4 8.1 %Chemical process 140.6 8.1 % 156.1 8.0 % 157.3 8.1 %Other 17.8 1.0 % 20.9 1.1 % 23.3 1.2 %Total $ 458.4 26.5 % $ 461.4 23.6 % $ 468.6 24.3 %

A description of our Materials Technologies products and services and their applications follows:

ProductsandServices Overview/Use KeyBrandsPharma/Consumer Specialty materials used as additives, intermediates, and purification

aids for pharmaceuticals, nutraceuticals, toothpaste, beer, food, andcosmetic segments, including:Pharmaceutical and nutraceutical excipients, carrier for oily APIs, anddrug delivery

SYLOID • LUDOX • SYLOID XDP •SILSOL

Fine chemicals, including regulatory starting materials andintermediates, especially peptide building blocks, specialty amino acids,chiral boronic acids, and estersToothpaste abrasives and thickening agents SYLODENT • SYLOBLANC • SIDENTFree-flow agents; anticaking agents; heating agents; tableting aids; cosmetic additives and carriers for flavor, fragrance, orother active ingredients; and desiccants for food and pharma packaging

PERKASIL • SYLOID • SYLOSIV

Edible oil and biofuel refining agents, stabilizers and clarification aids forbeer, juices and other beverages

TRISYL • DARACLAR

Chromatography purification products DAVISIL • VYDAC • VYKING™Coatings Functional additives for wood, coil, general industrial, and architectural

coatings that provide surface effects and corrosion protection for metalsubstrates, including:Matting agents, anticorrosion pigments, TiO2 extenders and moisturescavengers for paints and lacquers

SYLOID • SHIELDEX • SYLOSIV •SYLOWHITE™

Additives for matte, semi-glossy and glossy ink receptive coatings onhigh performance ink jet papers, photo paper, and commercial wide-format print media

SYLOJET • DURAFILL • LUDOX

Paper retention aids, functional fillers, paper frictionizers DURAFILL • LUDOXDefoamers actives ZEOFLO • ZEOFOAM™

Chemical Process Functional materials for use in plastics, rubber, tire, and metal casting,and adsorbent products for petrochemical, natural gas, and morespecialized applications, including:Reinforcing agents for rubber and tires PERKASILInorganic binders for precision investment casting and refractoryapplications and surface modification aids for metal and ceramicsubstrates

LUDOX

Static adsorbents for dual pane windows and refrigerant applications,moisture scavengers, and package desiccants

PHONOSORB • SYLOSIV • CRYOSIV• PROTEKSORB

Chemical metal polishing aids and formulations for chemical mechanicalplanarization/electronics applications

POLIEDGE • LUDOX

Antiblocking additives for plastic films to prevent adhesion of layers inmanufacturing

SYLOBLOC

Process adsorbents used in petrochemical and natural gas processesfor such applications as ethylene-cracked-gas-drying, natural gas dryingand sulfur removal

SYLOBEAD

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Silica-based Products

We globally manufacture functional additives and process aids, such as silica gel, colloidal silica, zeolitic adsorbents, precipitated silica andsilica-aluminas, for a wide variety of applications and end-use industries. We also custom manufacture fine chemical intermediates and regulatorystarting materials used primarily in the pharmaceutical and nutritional supplements industries.

Our materials are integrated into our customers’ manufacturing processes and when combined with our technical support, can increase theefficiency and performance of their operations and their products. By working closely with our customers, we seek to help them respond quickly tochanging consumer demands.

In addition, we focus on developing and manufacturing products that differentiate our customers’ products and help them meet evolvingregulatory and environmental requirements. For example, our SYLOID coatings additives are designed to be used in more sustainable water-basedand VOC-compliant coatings, and our SHIELDEX silicas allow our customers to reformulate their anti-corrosive coating products to eliminate heavymetals. Our pharmaceutical excipients help improve bioavailability, extend shelf-life, and/or make drug manufacturing more efficient. Our dentalsilicas are engineered to provide high cleaning with gentle abrasivity. Our DARACLAR and TRISYL silicas allow our customers to reduce theirenvironmental footprint: our beer stabilization silicas offer greater productivity to breweries while allowing them to use water more efficiently, and ouredible oil and biofuel refining aids enable the processing of waste materials in refineries, reducing feedstock losses and solid waste sent to landfills.Our custom manufacturing of advanced intermediates supports pharmaceutical drug development processes, enabling commercialization of life-saving therapies. Our LUDOX colloidal silicas enable our customers to produce automotive catalytic converters for automakers to meet emissionscontrol regulations.

In 2020 we deepened our collaboration with customers to align some of our Materials Technologies product capabilities to support customersin addressing the global COVID-19 pandemic. Our silica-based technology provides separation capabilities found in the PCR (polymerase chainreaction) test kits. Similarly, our silica-based materials are used in purifying lipids that are required to hold together mRNA used in two of the leadingapproved COVID-19 vaccines.

Manufacturing, Marketing and Raw Materials

Our Materials Technologies products are manufactured by a network of globally integrated plants that are positioned to service our customers.Our integrated supply chain organization is responsible for the effective utilization of our manufacturing capabilities. Our global footprint allows us topartner effectively with both multinational and regional companies requiring multiple manufacturing facilities complemented by regional technicalexpertise in local languages. For a discussion of our manufacturing plants for Materials Technologies, see Item 2, “Properties,” below.

We use country-based direct sales forces and further support our customers with application-specific technical customer service teams tomarket our Materials Technologies products. Our sales force seeks to develop long-term relationships with our customers and focuses onconsultative sales, technical support, and key account growth programs. To ensure full geographic coverage, our direct sales organization is furthersupplemented by a network of distributors.

The principal raw materials for Materials Technologies products include sodium silicate, zeolite, sand, soda ash, sulfuric acid, and caustic soda.Multiple suppliers are generally available for each of these materials; however, some of our raw materials may be provided by single sources ofsupply. We seek to mitigate the risk of using single source suppliers by identifying and qualifying alternative suppliers or, for unique materials, byusing alternative formulations from other suppliers. In some instances, we produce our own raw materials and intermediates.

Prices for some of our raw materials and energy can be volatile. In response to increases in input costs, we generally take actions intended tomitigate the effects of higher costs including developing alternative formulations for our products, increasing productivity, and increasing prices.

As in many chemical businesses, we consume significant quantities of natural gas in the production of Materials Technologies products. Worldevents and other economic factors can cause volatility in the price of natural gas. Increases or decreases in the cost of natural gas and rawmaterials can have a significant impact on

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our operating margins. We have implemented a risk management program under which we hedge natural gas in a way that is designed to mitigatethe effects of price volatility.

Backlog of Orders; Working Capital

While at any given time there may be some backlog of orders, this backlog is not material in respect to our total annual sales for MaterialsTechnologies, nor are the changes, from time to time, significant. Our working capital consists of inventory, accounts receivable and accountspayable. We closely manage these working capital accounts. We value inventory balances under the FIFO method. Inventories have turnedregularly.

Competition

There are many manufacturers of engineered materials that market their products on a global basis including Evonik, PQ, and Nalco.Competition is generally based on product performance, technical service, quality and reliability, price, and other differentiated product features toaddress the needs of customers, end-users, and brand owners. Our products compete on the basis of distinct technology, product quality, andcustomer support. Competition for these products is highly fragmented, with a large number of companies that sell their products on a global orregional basis.

INTELLECTUALPROPERTY;RESEARCHACTIVITIES

Competition in the specialty chemicals and specialty materials industry is often based on technological superiority and innovation. Our ability tomaintain our margins and effectively compete with other suppliers depends on our ability to introduce new products based on innovative technology,as well as our ability to obtain patent or other intellectual property protection. Our research and development programs emphasize development ofnew products and processes, improvement of existing products and processes, and application of existing products and processes to new industriesand uses. We conduct most of our research activity in North America and Europe.

We file patents in order to protect our investments in innovation arising from research and product development in all our businesses, and as aresult, numerous patents and patent applications protect our products, formulations, manufacturing processes, equipment, and improvements. Forexample, we selectively file and obtain patents in our Refining Technologies business, as well as in our chemical catalysts product line in ourSpecialty Catalysts business, for strategic new products or for significant business opportunities. We routinely file and obtain patents in a number ofcountries around the world that are significant to our polyolefin catalysts product line in our Specialty Catalysts business.

In our Materials Technologies business, we focus our research on the development and use of specialty materials products and formulationsfor diverse applications. We file patents and trademarks in various countries to protect our unique products, processes and expertise in strategicareas of our business, and to cover key product innovations in adjacent market segments.

We also benefit from the use of trade secret information, including know-how and other proprietary information relating to many of our productsand processing technologies in all of our businesses, including, but not limited to, our business in licensing UNIPOL Polypropylene ProcessTechnology.

While we seek legal protection for our innovations, there can be no assurance, however, that our patents, patent applications and precautionsto protect trade secrets and know-how will provide sufficient protection for our intellectual property. In addition, other companies may independentlydevelop technology that could replicate, and thus diminish the advantage provided by, our trade secrets. Other companies may also developalternative technology or design-arounds that could circumvent our patents or may acquire patent rights applicable to our business which mightinterpose a limitation on expansion of our business in the future.

ENVIRONMENT,HEALTH,SAFETY,ANDSECURITY(or“EHSS”)MATTERSANDGOVERNMENTALREGULATIONS

We are subject, along with other manufacturers of specialty chemicals, to stringent regulations under numerous regional, national, provincial,state and local EHSS laws and regulations relating to the manufacture, storage, handling, transportation, disposal and stewardship of chemicals andother materials. In addition to those laws and regulations, as we operate and/or sell to customers in over 60 countries, we must comply withimportant government regulations around the globe with respect to wide-ranging matters, including business and operating

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licenses, reporting requirements, registrations of intellectual property rights, human capital management, mine safety, and customs and taxes,among others. Cumulatively, the expenses of compliance with government regulations have a material effect on our earnings; however, as othermanufacturers of specialty chemicals face similar regulations (provided they operate under similar regulatory frameworks), we do not see ourcompliance as creating a material competitive disadvantage to date, and our conscientious adherence to safety and other regulations has positiveeffects on our overall position as a global company. Nevertheless, changes in, or additions to, governmental regulations may lead to additionalexpenditures and negative effects on our operations.

Environmental laws require that certain responsible parties, as defined in the relevant statute, fund remediation actions regardless of legality oforiginal disposal or ownership of a disposal site. We are involved in various response actions to address the presence of chemical substances asrequired by applicable laws.

We have expended substantial funds to comply with environmental laws and regulations and expect to continue to do so in the future. Thefollowing table sets forth our expenditures in the past three years, and our estimated expenditures in 2021 and 2022, for (i) the operation andmaintenance of manufacturing facilities and the disposal of wastes; (ii) capital expenditures for environmental control facilities; and (iii) siteremediation:

(Inmillions)

OperationofFacilitiesandWasteDisposal

CapitalExpenditures

SiteRemediation

2018 $ 56 $ 8 $ 18 2019 54 7 14 2020 56 13 8 2021(1) 56 13 18 2022(1) 58 23 10 ___________________________________________________________________________________________________________________

(1) Amounts are based on environmental response matters for which sufficient information is available to estimate costs. We do not have sufficientinformation to estimate all of our possible future environmental response costs. As we receive new information, our estimate of such costs may changematerially.

The table above does not include estimated expenditures related to the replacement of the dam spillway on the Libby, Montana, mine site. Weare legally obligated to operate the dam and construct a new spillway in accordance with the conditions of the latest permit issued by the MontanaDepartment of Natural Resources and Conservation. We have estimated the total cost of the project to be $95.0 million, with the timing ofdisbursements subject to a number of variables. Construction will begin in 2021 and is expected to take three to four years. Additional informationabout this matter and our environmental remediation activities is provided in this Report in Item 8 “Financial Statements and Supplementary Data”under Note 10, “Commitments and Contingent Liabilities,” to the Consolidated Financial Statements, which information is incorporated herein byreference.

EHSS Programs

We continuously seek to improve our environmental, health, safety, and security performance. To the extent applicable, we extend the basicelements of the American Chemistry Council’s RESPONSIBLE CARE program to all our locations worldwide. Our Environment, Health, Safety, andSecurity Policy and RESPONSIBLE CARE MANAGEMENT SYSTEM guide the company, our operating segments, and our facilities worldwide insystematically managing the environmental, health, safety, process safety, product safety, security, and sustainability aspects of our operations.

Sustainability

Overview

We succeed when we deliver value to our customers, and that success is increasingly based on how we help them meet their sustainabilitygoals. Many of our products and technical services improve the efficiency of our customers’ products and processes, reduce energy or water use,cut harmful emissions, conserve material inputs, and/or reduce waste. Several of our technologies enable our customers to make products thatmeet the toughest environmental standards or to reformulate products to address rising consumer and regulatory expectations for sustainability,human health, and safety. As a leading manufacturer of process catalysts, we have become an active participant in the circular economy, withincreasing business in assisting our customers with the recycling or

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reprocessing of spent catalysts. As part of our commitment to RESPONSIBLE CARE , we systematically track safety and environmentalperformance through a comprehensive, global EHSS management system covering the environmental, health, safety (including process safety andproduct safety) and security aspects of our operations, and track progress through pertinent metrics.

In 2019, we began reporting to the Carbon Disclosure Project (“CDP”). This year, we made our CDP Climate and CDP Water disclosurespublic for the first time. We also published sustainability disclosures aligned with the Sustainability Accounting Standards Board (“SASB”) standardfor the chemical industry. In addition, we strengthened the governance of our sustainability and environmental, social, and governance (“ESG”)related activities by naming a Chief Sustainability Officer (“CSO”) reporting directly to the CEO, and established a Sustainability Leadership Councilcomposed of the CSO and leadership from Grace businesses and integrated supply chain. We also established targets to reduce scope 1 andscope 2 greenhouse gas (“GHG”) emissions by 22% from a baseline of 2019 by 2029, as well as 10-year reduction targets for water consumptionand waste generation.

Product Portfolio

As part of a strategic review of our product portfolio, in 2019 we identified the products that directly contribute to our customers’ sustainabilityobjectives, including:

• Products designed for use-phase efficiency — defined by the SASB as products that “through their use—can be shown to improveenergy efficiency, eliminate or lower GHG emissions, reduce raw materials consumption, increase product longevity, and/or reducewater consumption,” either through:

◦ Improved products — by increasing the efficiency of a product during its use phase, or◦ Improved processes — by increasing the efficiency of the manufacturing processes used to make products;

• Meeting the strictest environmental standards — products that directly enable customers to meet environmental regulatory/legalrequirements applicable to their products or manufacturing processes; and

• Cleaner, safer products to meet consumer demands — products that enable customers to reformulate their products to avoid or reduceto de minimis levels substances of concern to their customers.

This year, we reviewed the requested disclosures from SASB and CDP as well as other ESG ratings organizations and expanded our productcategories to include products that make a significant contribution to the move toward a more circular economy through:

• Enabling material recycling and bio-feeds – products that are tailored to enable customers to replace petroleum inputs with bio-basedand recycled materials, and FCC catalyst sales (not counted above) where we take back spent FCC catalyst for recycling, or otherwiseenable the reuse or recycling of spent catalysts.

Together, the products in our portfolio, including those of our ART joint venture, that address these sustainability endpoints accounted forapproximately $1.1 billion, or 49% of our total revenue in 2020. Looking to the future, we estimate that 62% of our R&D projects are linked to at leastone of these customer sustainability objectives. We expect to see further opportunities as we continue to develop technologies for advanced plasticsrecycling and renewable fuels.

ESG Rankings

For 2020, we again earned a Gold Rating from EcoVadis, this year placing us in the 95 percentile of all companies ranked by EcoVadis ontheir sustainability performance. EcoVadis is a leading third-party entity that evaluates suppliers on a complex scale of sustainability and ESGfactors. CDP increased our 2020 Climate Disclosure score to a B-, above the average achieved by our chemical industry peers and above the NorthAmerican average. Also in 2020, the ESG Risk Rating from Sustainalytics placed us in the top quintile of both chemical and specialty companies.Source Sustainalytics.

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Further Information

Shareholders and other interested persons can visit our website for additional sustainability information at www.grace.com/sustainability/en-us.That further information is not incorporated herein by reference and is not a part of this Annual Report on Form 10-K.

Security

We have implemented the RESPONSIBLE CARE Security Code through a company-wide security program focused on the security of ourpeople, processes, and systems. We have reviewed existing security (including cybersecurity) vulnerability and taken actions to enhance securitysystems where deemed necessary. In addition, we are complying with the Department of Homeland Security’s Chemical Facility Anti-TerrorismStandards, including identifying facilities subject to the standards, conducting security vulnerability assessments and developing and executing sitesecurity plans, as necessary.

OTHERINFORMATION,WEBSITE,ANDAVAILABILITYOFREPORTSANDOTHERDOCUMENTS

Our principal executive offices are located at: W. R. Grace & Co., 7500 Grace Drive, Columbia, Maryland 21044. We maintain a website atwww.grace.com. Our telephone number at our principal executive offices is +1 410.531.4000.

Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports, filed orfurnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are available, free of charge, on our website assoon as reasonably practicable after such reports are electronically filed with, or furnished to, the Securities and Exchange Commission, or SEC.These reports may be accessed through our website’s investor information page at http://investor.grace.com/. These reports as well as our proxyand information statements may also be accessed through the SEC’s website at www.sec.gov.

In addition, the charters for the Audit, Compensation, Nominating and Governance, and Corporate Responsibility Committees of our Board ofDirectors, our corporate governance principles and code of ethics are available, free of charge, on our website at www.grace.com/en-us/corporate-leadership/pages/governance.aspx. Printed copies of the charters, governance principles and code of ethics may be obtained free of charge bycontacting Grace Shareholder Services at +1 410.531.4167.

The information on our website is not, and shall not be deemed to be, a part of this report or incorporated into any other filings we make withthe SEC.

Our Principal Executive Officer and Principal Financial Officer have submitted certifications to the SEC pursuant to the Sarbanes Oxley Act of2002 as exhibits to this Report.

Important information can be found throughout this Form 10-K and shareholders and potential investors are encouraged in particular to reviewItem 1A, “Risk Factors.”

EXECUTIVEOFFICERS

See “Information about our Executive Officers” following Part I, Item 4 of this Report for information about our Executive Officers.

Item1A.RISKFACTORS

In addition to general economic, business and market conditions, we are subject to other risks and uncertainties, including, without limitation,the risks set forth below. For reference, we have divided the various significant risks to our business, financial condition, and results of operationsinto the following three categories: (i) key business risks; (ii) risks related to legacy matters; and (iii) risks related to financial matters, as set forthbelow.

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Key Business Risks

The global COVID-19 pandemic has had a significant negative effect on certain industries into which we supply products and services,and on our financial results. The pandemic is expected to continue to negatively impact our operations and businesses until successfullycontrolled.

The COVID-19 pandemic caused an economic slowdown that led to a global recession. If resulting recessionary trends again turn negative orexacerbate, or if there is a resurgence of COVID-19, including variants thereof, such events could have a negative effect on our business, financialcondition, and future results. Resulting recessions may impact our share price, as well as our ability to access the capital markets and sources ofliquidity on reasonable terms, or at all.

The COVID-19 pandemic has led to significantly lower transportation fuel demand and a reduction in refining activity, which has negativelyaffected demand for our refining catalysts. Manufacturing activity reduced as a result of the pandemic. Demand for certain manufactured products,including polyolefin resins and products made with our specialty silicas, declined and negatively affected demand for our polyolefin catalysts andspecialty silicas.The pandemic continues to present us with significant uncertainty.

The COVID-19 pandemic has also heightened risks associated with our internal operations. An outbreak among our employee population couldhave a material adverse effect on our overall business and financial condition. Additionally, a large number of our employees are working remotelyas a result of restrictions imposed to control the spread of the virus. This could result in increased cybersecurity risk, which could have a materialadverse effect on our overall business and financial condition.

The global scope of our operations subjects us to the risks of doing business in foreign countries, which could adversely affect ourbusiness, financial condition and results of operations.

We operate our business on a global scale with approximately 73% of our 2020 consolidated sales outside the United States. We operateand/or sell to customers in over 60 countries and in over 30 currencies. We currently have many production facilities, research and developmentfacilities, and administrative and sales offices located outside North America, including facilities and offices located in EMEA (Europe Middle EastAfrica), Asia Pacific and Latin America. We expect non-U.S. sales to continue to represent a substantial majority of our revenue. Accordingly, ourbusiness is subject to risks related to the differing legal, political, social and regulatory requirements and economic conditions of many jurisdictions.Risks inherent in non-U.S. operations include the following:

• commercial agreements may be more difficult to enforce and receivables more difficult to collect;• intellectual property rights may be more difficult to enforce;• increased shipping costs, disruptions in shipping or reduced availability of freight transportation;• difficulty transferring our profits or capital from foreign operations to other countries where such funds could be more profitably

deployed;• unexpected adverse changes in export duties, quotas and tariffs, and difficulties in obtaining export licenses;• differing regulatory responses to the COVID-19 pandemic in the jurisdictions in which we operate;• additional withholding and other taxes or restrictions on foreign trade or investment, including import, currency exchange and capital

controls, charges and limitations;• foreign governments may nationalize private enterprises;• political or economic repercussions on a domestic, country-specific or global level from terrorist activities and the response to such

activities;• unexpected adverse changes in foreign laws or regulatory requirements;• the impact of the United Kingdom’s exit from the European Union on January 31, 2020, and the provisional application of the EU-UK

Trade and Cooperation Agreement on January 1, 2021;• increased cash taxes in the event of a change in tax laws, regulations or interpretations in one or more foreign jurisdictions, could

adversely affect our business, financial condition, results of operations, or liquidity; and• geopolitical risk, where unexpected changes in global, regional, or local political or social conditions could adversely affect our foreign

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Our success as a global business will depend, in part, upon our ability to succeed in differing legal, regulatory, economic, social and politicalconditions by developing, implementing and maintaining policies and strategies that are effective in each location where we do business.

In addition to the risks and uncertainties that we discussed above, recent world events have increased the risks posed by international tradedisputes, tariffs, and sanctions. We procure a wide spectrum of commodities globally to support our production. For materials sourced from nationsthat could be impacted by trade disputes, tariffs or sanctions, we could potentially face increased costs, supply disruptions and/or costs associatedwith securing alternative materials. Additionally, such disputes, tariffs, and sanctions could potentially lead to a reduction in our sales of products,technology, and services. We view geopolitical risk along with other potential supply chain and sales risks, and work actively to diversify and mitigatethese potential impacts; however, such events could adversely affect our business, financial condition and results of operations.

As we operate worldwide in a competitive environment, global economic and financial market conditions may adversely affect ourbusiness, financial condition and results of operations.

We compete by selling value-added products, technologies and services. Increased levels and numbers of competitors, globally or regionally,could negatively impact our results of operations. Economic conditions around the world can have a direct impact on our revenues. A global orregional economic downturn or market uncertainty could reduce the demand for our products, technologies and services, which could negativelyimpact our results of operations. Since many of our customers are refiners, our fluid catalytic cracking (FCC) and hydroprocessing catalyst (HPC)businesses are highly dependent on the economics of the petroleum refining industry. Demand for our FCC and HPC products is affected byrefinery throughput, the type and quality of refinery feedstocks, and the demand for transportation fuels and other refinery products, such aspropylene. Also, disruptions in the financial markets could have an adverse effect on our ability to finance our operations and growth plans, andcould negatively impact our suppliers and customers in similar manners.

We are exposed to currency exchange rate changes that impact our profitability.

We are exposed to currency exchange rate risk through our U.S. and non-U.S. operations. Changes in currency exchange rates may materiallyaffect our operating results. For example, changes in currency exchange rates may affect the relative prices at which we and our competitors sellproducts in the same region and the cost of materials used in our operations. A substantial portion of our net sales and assets are denominated incurrencies other than the U.S. dollar, particularly the euro. When the U.S. dollar strengthens against other currencies, at a constant level ofbusiness, our reported sales, earnings, assets and liabilities are reduced because the non-U.S. currencies translate into fewer U.S. dollars.

We incur a currency transaction risk whenever one of our operating subsidiaries enters into either a purchase or a sales transaction using acurrency different from the operating subsidiary’s functional currency. Given the volatility of exchange rates, we may not be able to manage ourcurrency transaction risks effectively, or volatility in currency exchange rates may expose our financial condition or results of operations to asignificant additional risk.

Prices for certain raw materials and energy are volatile and can have a significant effect on our manufacturing and supply chainstrategies as we seek to maximize our profitability. If we are unable to successfully adjust our strategies in response to volatile rawmaterials and energy prices, such volatility could have a negative effect on our earnings in future periods.

We use metals, natural gas, petroleum-based materials, and other materials in the manufacture of our products. We consume substantialamounts of energy in our manufacturing processes. Prices for these materials and energy are volatile and can have a significant effect on ourpricing, sales, manufacturing and supply chain strategies as we seek to maximize our profitability. Our ability to adjust strategies successfully inresponse to volatile raw material and energy prices is a significant factor in maintaining or improving our profitability. If we are unable to successfullyadjust our strategies in response to volatile prices, such volatility could have a negative effect on our sales and earnings in future periods.

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A substantial portion of our raw materials are commodities whose prices fluctuate as market supply and demand fundamentals change.

We attempt to manage exposure to price volatility of major commodities through:

• long-term supply contracts;• contracts with customers that permit adjustments for changes in prices of commodity-based materials and energy;• forward buying programs that layer in our expected requirements systematically over time; and• limited use of financial instruments.

Although we regularly assess our exposure to raw material price volatility, we cannot always predict the prospects of volatility and we cannotalways cover the risk in a cost effective manner.

Certain of our raw materials may be provided by single sources of supply. We may not be able to obtain sufficient raw materials due tounforeseen developments that would cause an interruption in supply. Even if we have multiple sources of supply for raw materials, these sourcesmay not make up for the loss of a major supplier.

If we are not able to continue our technological innovation and successful introduction of new products, our customers may turn to othersuppliers to meet their requirements.

The specialty chemicals and specialty materials industries and the end-use markets into which we sell our products experience ongoingtechnological change and product improvements. A key element of our business strategy is to invest in research and development activities with thegoal of introducing new high-performance, technically-differentiated products. We may not be successful in developing new technology and productsthat effectively compete with products introduced by our competitors, and our customers may not accept, or may have lower demand for, our newproducts. If we fail to keep pace with evolving technological innovations or fail to improve our products in response to our customers’ needs, thenour business, financial condition and results of operations could be adversely affected as a result of reduced sales of our products.

We may be subject to claims of infringement of the intellectual property rights of others, which could hurt our business.

From time to time, we face infringement claims from our competitors or others alleging that our processes or products infringe on theirproprietary technologies. Any claims that our products or processes infringe the intellectual property rights of others, regardless of the merit orresolution of the claims, could cause us to incur significant costs in responding to, defending and resolving the claims, and may divert the efforts andattention of our management and technical personnel from our business. If we are found to be infringing on the proprietary technology of others, wemay be liable for damages, and we may be required to change our processes, redesign our products, pay others to use the technology, or stopusing the technology or producing the infringing product. Even if we ultimately prevail, the existence of the lawsuit could prompt our customers toswitch to products that are not the subject of infringement suits.

Some of our employees are unionized, represented by works councils or employed subject to local laws that are less favorable toemployers than the laws in the United States.

As of December 31, 2020, we had approximately 4,000 global employees. Approximately 700 of our approximately 2,200 U.S. employees areunionized at 5 manufacturing sites, and approximately 1,400 of our employees outside the U.S. are represented by works councils and unions. Inaddition, a large number of our employees are employed in countries in which employment laws provide greater bargaining or other rights toemployees than the laws in the United States. Such employment rights require us to work collaboratively with the legal representatives of theemployees to effect any changes to labor arrangements. For example, most of our employees in Europe are represented by works councils thathave co-determination rights on any changes in conditions of employment, including certain salaries and benefits and staff changes, and mayimpede efforts to restructure our workforce. A strike, work stoppage or slowdown by our employees or significant dispute with our employees,whether or not related to these negotiations, could result in a significant disruption of our operations or higher ongoing labor costs.

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We intend to pursue acquisitions, joint ventures and other transactions that complement or expand our businesses. We may not be ableto complete proposed transactions and even if completed, the transactions may involve a number of risks that may materially andadversely affect our business, financial condition and results of operations.

We intend to continue to pursue opportunities to buy other businesses or technologies that could complement, enhance or expand our currentbusinesses or product lines or that might otherwise offer us growth opportunities. We may have difficulty identifying appropriate opportunities or, ifwe do identify opportunities, we may not be successful in completing transactions for a number of reasons. Any transactions that we are able toidentify and complete may involve a number of risks, including:

• the diversion of management’s attention from our existing businesses to integrate the operations and personnel of the acquired orcombined business or joint venture;

• possible adverse effects on our operating results during the integration process;• failure of the acquired business to achieve expected financial, operational, and other objectives;• possible assumption of unexpected liabilities; and• inability to obtain indemnification from other parties to transactions.

In addition, we may not be able to successfully or profitably integrate, operate, maintain and manage any newly acquired operations or theiremployees. We may not be able to maintain uniform standards, controls, procedures and policies, which may lead to operational inefficiencies.

We spend large amounts of money for environmental compliance in connection with our current and former operations.

As a manufacturer of specialty chemicals and specialty materials, we are subject to stringent regulations under numerous U.S. federal, state,local and foreign environmental, health and safety laws and regulations relating to the generation, storage, handling, discharge, disposition andstewardship of chemicals and other materials. We have expended substantial funds to comply with such laws and regulations and have establisheda policy to minimize our emissions to the environment. Legislative, regulatory and economic uncertainties (including existing and potential laws andregulations pertaining to climate change) make it difficult for us to project future spending for these purposes, and if there is an acceleration in newregulatory requirements, we may be required to expend substantial additional funds to remain in compliance, which may be material.

Evolving energy consumption patterns; investor sentiment regarding fossil fuels and related matters; and risks related to climate change,may negatively affect our business, financial condition, and results of operations, and our stock price.

We are engaged in the production and sale of specialty chemicals and specialty materials used in petrochemical, refining, and other chemicalmanufacturing applications. These industries are facing challenges from ESG concerns of investors; the economic impacts of climate changedevelopments; and regulation of GHGs, such as carbon dioxide, methane, and nitrous oxide, among others. In addition, the increasing availability ofelectric vehicles offers an alternative that could lead to reduced demand for liquid transportation fuels. Resulting reductions in refining and relatedactivities could have a negative effect on our revenues and business.

Recently, there have been intensifying efforts directed at various members of the investment community to promote the divestment of shares ofenergy companies, as well as to pressure lenders and other financial services companies to limit or curtail activities with energy companies. As weprovide products and services to energy companies, should these efforts be successful or expanded, there may be a negative impact on ourrevenues and business, and our stock price.

Potential effects of climate change include increased frequency, severity, and impact of weather-related events. Multiple Grace facilitiesglobally are located in areas that may be at risk from hurricanes and other weather-related events that could cause production interruptions. Keysuppliers and associated distribution routes for raw materials and finished goods are similarly at risk of interruptions from severe weather events.Multiple customers are likewise located in areas that could be impacted by extreme weather events. These circumstances present businesscontinuity and related risks.

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We work with dangerous materials that can injure our employees, damage our facilities, disrupt our operations, and contaminate theenvironment.

Some of our operations involve the handling of hazardous materials that may pose the risk of fire, explosion, or the release of hazardoussubstances. Such events could result from natural disasters, operational failures or terrorist attacks, and might cause injury or loss of life to ouremployees and others, environmental contamination, and property damage. These events might cause a temporary shutdown of an affected plant,or portion thereof, and we could be subject to penalties or claims as a result of any of these events. A disruption of our operations caused by theseor other events could have a material adverse effect on our results of operations.

We are subject to business continuity risks that may adversely affect our business, financial condition and results of operations.

We are subject to significant risks from both natural disasters and accidents such as fires, storms, and floods; public health concerns, includingpandemics and quarantines; and disruptive events, such as war, insurrection, and terrorist actions; and other force majeure events. These types ofoccurrences can negatively affect our manufacturing, supply chain, logistics, information technology, and communications functions. Similarly, theycan strike major suppliers and customers, thus restricting or delaying our supply of raw materials or energy as well as reducing or deferring demandfor our products and services. In the event of a major disruption, we may not be able to replace this business in a timely manner or at similarmargins. Also, we have centralized certain administrative functions, primarily in North America, Europe and Asia, to improve efficiency and reducecosts. To the extent that these central locations are disrupted or disabled, key business processes, such as invoicing, payments and generalmanagement operations, could be interrupted.

We insure against many of these risks by carrying property, general, liability, and other coverages with highly rated global insurers. Given thecurrent insurance market as well as our recent claims experience, we may experience increased costs to purchase insurance coverage goingforward. Our ability to obtain certain coverage, including contingent time element business interruption insurance, for losses related to our suppliersor customers may be limited or more costly in the future.

A failure of our information technology (“IT”) infrastructure could adversely impact our business and operations.

We increasingly rely upon the capacity, reliability and security of our IT infrastructure and our ability to expand and continually update thisinfrastructure in response to the changing needs of our business. Additionally, a large number of our employees are working remotely as a result ofrestrictions imposed to control the spread of the COVID-19 virus. If we experience a problem with the functioning of an important IT system, theresulting disruptions could have an adverse effect on our business. Our IT systems affect virtually every aspect of our business, including supplychain, manufacturing, logistics, finance and communications. We and certain of our third-party vendors receive and store personal information inconnection with our human resources operations and other aspects of our business. Any IT system failure, natural disaster, accident, or intentionalbreach could result in disruptions to our operations.

Our ability to operate our businesses and our financial condition could be significantly undermined by cybersecurity breaches.

Our IT systems are subject to cyberattack and other similar disruptions. Breaches by hackers, the introduction of computer viruses,ransomware, and other cybersecurity incidents affecting our IT systems could result in disruptions to our operations. Also, such incidents couldinclude theft of our trade secrets and other intellectual property, as well as confidential customer, employee and business information, which couldbe used by unauthorized parties and publicly disclosed. This could negatively affect our relationships with customers and our ability to competeeffectively, and could ultimately harm our reputation, business, financial condition and results of operations. In addition, we may be required to incursignificant costs to protect against damage caused by cybersecurity breaches in the future.

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Risks Related to Legacy Matters

We are subject to liabilities for Legacy Matters, which include (i) product, (ii) environmental, and (iii) other liabilities, relating to pastactivities of Grace.

In addition to the legacy product and legacy environmental liabilities discussed below in these Risk Factors, we are subject to other liabilitiesrelating to past activities of Grace. Beginning in 1971, as part of implementing a wet milling process at the Libby, Montana, vermiculite mine, weconstructed a dam at the mine property that now prevents vermiculite ore tailings from moving into nearby creeks and rivers. Ongoing operation ofthe dam is regulated by the Montana Department of Natural Resources and Conservation (“DNRC”). In April 2019, the DNRC renewed the permitnecessary for operation of the dam. We are legally obligated to operate the dam and construct a new spillway in accordance with the latest permitconditions.

Construction of the new dam spillway at the former mine site is a key element of our overall remediation strategy. The project includes both anupper spillway and a lower spillway that are being managed as two separate projects with different engineering design and construction timelines. In2019, we contracted a third-party engineering and consulting firm to develop an initial range of cost estimates for the total project. Based on thiswork, we recorded a liability of $68.0 million in 2019 for the estimated costs of the project. These costs were preliminary and subject to change asnew information becomes available, including defining the final scope of the projects through the contract bidding process. During the three monthsended September 30, 2020, we completed a review of contractor bids for the replacement of the upper spillway and increased our cost estimate forthis portion of the project by $27.0 million, bringing the estimate for the total project to $95.0 million. Regarding the lower spillway, final engineeringwill be completed and submitted to the state of Montana for design approval in 2021, after which we will seek contract bids for this portion of theproject. We believe it is reasonably possible that the ultimate costs of the two spillway projects could range between $80 million and $120 million. Aswe receive new information, our estimated liability may change materially. Construction will begin in 2021 and is expected to take three to fouryears.

We are subject to environmental clean-up costs, fines, penalties and damage claims that have been and continue to be costly.

In the U.S., we are subject to lawsuits and regulatory actions, in connection with current and former operations (including some divestedbusinesses and off-site disposal facilities), that seek clean-up or other remedies. We are also subject to similar risks outside of the U.S.

We purchased a vermiculite mine in Libby, Montana, in 1963 and operated it until 1990. Vermiculite concentrate from the Libby mine was usedin the manufacture of attic insulation and other products. Some of the vermiculite ore contained naturally occurring asbestos. We are engaged withthe U.S. Environmental Protection Agency (or the “EPA”) and other federal, state and local governmental agencies in a remedial investigation andfeasibility study (or the “RI/FS”) of the Libby mine and the surrounding area, known as Operable Unit 3 (or “OU3”). The RI/FS will study the areaswithin OU3 requiring remediation and will identify possible remedial action alternatives. Possible remedial actions within OU3 are wide-ranging, frominstitutional controls such as land use restrictions, to more active measures involving soil removal, containment projects, or other protectivemeasures. As part of the RI/FS process, we contracted an engineering and consulting firm to develop a range of possible remedial alternatives andassociated cost estimates for OU3. Based on this work, we recorded a pre-tax charge of $70.0 million during the three months ended September 30,2018, for the estimated costs of remediation of OU3. We believe that this amount should provide for a protective remedy meeting the statutoryrequirements of the Comprehensive Environmental Response, Compensation, and Liability Act.

The estimated costs of remediation are preliminary and consist of several components, each of which may vary significantly as the remedialalternatives are further developed. It is reasonably possible that the ultimate costs of remediation could range between $30 million and $170 million.We are working closely with the EPA, and the ultimate remedy will be determined by the EPA after the RI/FS is finalized. Such remedy will be setforth in a Record of Decision (or “ROD”) that is currently expected to be issued by the EPA no earlier than 2024. Costs associated with the moreactive remedial alternatives would be expected to be incurred over a decade or more. We will reevaluate our estimated liability as remedialalternatives evolve based on further work by the engineering and consulting firm and discussions with the EPA as the RI/FS process moves towarda ROD. Technical memoranda expected prior to the issuance of the ROD may provide insight into the likely remedial alternatives ultimatelyselected, allowing us to update our cost of remediation estimate. Depending on the remedial alternatives that the EPA selects in the ROD, the totalcost of remediating OU3 may exceed our current estimate

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by material amounts. The amounts set forth above do not include possible liability for natural resources damage. Based on ecological studiesconducted by the EPA, we do not believe that natural resources damage has occurred. However, if a party were to be successful in asserting anatural resources damage claim, liability related to such obligation could be material.

We have cooperated with the EPA in investigating and remediating a number of formerly owned or operated sites that processed Libbyvermiculite into finished products. We have recorded a liability for remaining expected response costs, including costs for EPA oversight andpotential future site remediation, where a review has indicated that liability is probable and the cost is estimable. The EPA may commence additionalinvestigations in the future at other sites that processed Libby vermiculite. Liability for unaccrued additional investigation and remediation costs isprobable but not yet estimable, and could be material.

We have recorded liabilities for all environmental matters for which a loss is considered to be probable and sufficient information is available toreasonably estimate the loss. We also face legacy environmental liability for response costs at sites not related to our former vermiculite mining andprocessing activities. This liability relates to our former businesses or operations, including our share of liability at off-site disposal facilities. Ourestimated liability is based upon regulatory requirements and environmental conditions at each site. As we receive new information, our estimatedliability may increase materially.

We may be required to make one or more contingent deferred payments to the trust for asbestos property damage claims, which we referto as the “PD Trust,” in respect of claims related to our former Zonolite attic insulation (“ZAI”) product (“ZAI PD Claims”); we may also beobligated to make additional payments to the PD Trust in respect of “Other PD Claims” (those being asbestos property damage claimsother than ZAI PD Claims); and our obligations to make payments to the PD Trust in respect of Other PD Claims is not capped.

Grace emerged from bankruptcy effective February 3, 2014 (the “Effective Date”). Under the Joint Plan, the PD Trust was established andfunded under Section 524(g) of the Bankruptcy Code. The order of the Bankruptcy Court confirming the Joint Plan contains a channeling injunction,which provides that all pending and future asbestos-related property damage claims and demands (or “PD Claims”) can only be brought against thePD Trust. The PD Trust contains two accounts. One of these accounts is the “ZAI PD Account,” which is funded in respect of claims related to ZAI.The other account is the “PD Account,” which is funded solely in respect of Other PD Claims.

Under the Joint Plan, all pending and future asbestos-related personal injury claims are channeled for resolution to a personal injury trust (the“PI Trust”). We have satisfied all of our financial obligations to the PI Trust. We have contingent financial obligations remaining to the PD Trust. Withrespect to ZAI PD Claims, the PD Trust was funded with $49.4 million (net of $15 million of attorneys’ fees) to pay claims and expenses. We arealso obligated to make up to 10 contingent deferred payments of $8 million per year to the PD Trust during the 20-year period beginning onFebruary 3, 2019, with each such payment due only if the assets of the PD Trust fall below $10 million during the preceding year. As ofDecember 31, 2020, the PD Trust has paid out approximately $38 million in ZAI PD Claims and expenses, leaving a balance of approximately $18million, including the benefit of realized investment gains.

Due to the limited claims history, the unique nature of this product, and the uncertainty of future claims patterns, an actuarial analysis wascompleted to estimate the range of possible future payments. The analysis was conducted by a third-party actuarial firm directed by us and usinghistorical claims data provided by the ZAI trustee. Certain key assumptions employed in the analysis were (1) projections of the future number offiled claims, assuming a percentage increase in claims during earlier years and annual decreases in later years; (2) application of historicalpercentages of claims closed with indemnity payment compared to total closed claims, applied on a regional basis; and (3) application of theaverage claim payout, which reflects the average indemnity cost per claim closing with payment. As a result of the analysis and taking into accountthe relative uncertainty of future claims activity, we determined that contingent funding obligations beyond 2025 are not reasonably estimable. Weestimate that the reasonable range of payments over the period of 2021 to 2025 is expected to be between $16 million and $24 million and projectthat the first payment could be due as early as 2022. In the 2019 fourth quarter, we recorded a $24.0 million liability related to probable futureobligations to fund the PD Trust for ZAI PD Claims. Our maximum financial obligation over the next 18 years is $80 million, and no single year’spayment can exceed $8 million.

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With respect to Other PD Claims, claims unresolved as of the Effective Date are to be litigated in the bankruptcy court and any future claimsare to be litigated in a federal district court, in each case pursuant to procedures approved by the bankruptcy court. To the extent any such Other PDClaims are determined to be allowed claims, they are to be paid in cash by the PD Trust. We are obligated to make a payment to the PD Trust everysix months in the amount of any Other PD Claims allowed during the preceding six months plus interest (if applicable) and the amount of PD Trustexpenses for the preceding six months (the “PD Obligation”). We have not paid any Other PD Claims since emergence. Annual expenses havebeen approximately $0.2 million per year. The aggregate amount to be paid under the PD Obligation is not capped, and we may be obligated tomake additional payments to the PD Trust in respect of the PD Obligation. We have accrued for those unresolved Other PD Claims that we believeare probable and estimable. We have not accrued for other unresolved or unasserted Other PD Claims as we do not believe that payment isprobable.

All payments to the PD Trust required after the Effective Date are secured by the Company’s obligation to issue 77,372,257 shares ofCompany common stock to the PD Trust in the event of default, subject to customary anti-dilution provisions.

Risks Related to Financial Matters

Our indebtedness may materially affect our business, including our ability to fulfill our obligations, react to changes in our business andincur additional debt to fund future needs.

We have a substantial amount of debt. As of December 31, 2020, we had $1,063.6 million of unsecured indebtedness outstanding and $926.8million of secured indebtedness outstanding. Our indebtedness may have material effects on our business, including to:

• require us to dedicate a substantial portion of our cash flow to principal and interest payments, thereby reducing funds available forworking capital, capital expenditures, acquisitions, research and development, distributions to shareholders (which fall within thediscretion of our Board of Directors taking into account financial, liquidity and other considerations), share repurchase programs andother purposes;

• restrict us from making strategic acquisitions or taking advantage of favorable business opportunities;• limit our flexibility in planning for, or reacting to, changes in our business and the industries in which we operate;• increase our vulnerability to adverse economic, credit and industry conditions, including recessions;• make it more difficult for us to satisfy our other obligations;• place us at a competitive disadvantage compared to our competitors that have relatively less debt; and• limit our ability to borrow additional funds, or to dispose of assets to raise funds, if needed, for working capital, capital expenditures,

acquisitions, research and development and other purposes.

If we incur additional debt, the risks related to our indebtedness may intensify.

Restrictions imposed by agreements governing our indebtedness may limit our ability to operate our business, finance our futureoperations or capital needs, or engage in other business activities. If we fail to comply with certain restrictions under these agreements,our debt could be accelerated, and we may not have sufficient cash to pay our accelerated debt.

The agreements governing our indebtedness contain various covenants that limit, among other things, our ability, and the ability of certain ofour subsidiaries, to:

• incur certain liens;• enter into sale and leaseback transactions; and• consolidate, merge or sell all or substantially all of our assets or the assets of our guarantors.

As a result of these covenants, we will be limited in the manner in which we can conduct our business, and may be unable to engage infavorable business activities or finance future operations or capital needs. Accordingly, these restrictions may limit our flexibility to operate ourbusiness. A failure to comply with the restrictions contained in these agreements, including maintaining the financial ratios required by our creditfacilities, could lead to an event of default which could result in an acceleration of our indebtedness. We cannot guarantee that our future operatingresults will be sufficient to enable us to comply with the covenants contained in the agreements governing our indebtedness or to remedy any suchdefault. In addition, in the event of an

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acceleration, we may not have or be able to obtain sufficient funds to make any accelerated payments. Additionally, in the event of a change incontrol, we will be required to offer to purchase our senior unsecured notes at a price equal to 101% of the aggregate principal amount outstandingplus accrued and unpaid interest.

Our indebtedness exposes us to interest expense increases if interest rates increase.

As of December 31, 2020, approximately $268.9 million of our borrowings were at variable interest rates and expose us to interest rate risk,excluding $586.5 million hedged by cross-currency swaps effective in November 2018, and $100.0 million hedged by interest rate swaps effective inApril 2018. If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amountborrowed would remain the same, and our net income would decrease. An increase of 100 basis points in the interest rates payable on our variablerate indebtedness would increase our annual estimated debt-service requirements by $2.7 million, assuming our consolidated variable interest rateindebtedness outstanding as of December 31, 2020, remains the same.

The uncertainty regarding the potential phase-out of LIBOR may negatively impact our operating results.

We currently have term loan borrowings, a revolving credit facility and financial derivatives that rely on the London Interbank Offered Rate(“LIBOR”) as a benchmark rate. All of these financial instruments use a three-month U.S. dollar LIBOR for their benchmark rate. The IntercontinentalExchange (“ICE”) Benchmark Administration (“IBA”) announced that it intends to cease publication of three-month U.S. dollar LIBOR on June 30,2023. No consensus exists as to what rate or rates will become accepted alternatives to LIBOR at this time, although the U.S. Federal Reserve, inconnection with the Alternative Reference Rates Committee (“ARRC”), a steering committee composed of large U.S. financial institutions, hasidentified the Secured Overnight Financing Rate (“SOFR”) as the rate that represents the best practice for replacement of the U.S. dollar LIBOR.SOFR is a more generic measure than LIBOR and considers the cost of borrowing cash overnight, collateralized by U.S. Treasury securities.

Given the inherent differences between LIBOR and SOFR, or any other alternative benchmark rate that may be established, there areuncertainties regarding a transition from LIBOR. These uncertainties include, but are not limited to, the need to amend all contracts with LIBOR asthe referenced rate and the impact on our cost of variable rate debt, including the use of certain financial derivatives. Based on guidance issued bythe IBA and other regulatory bodies, we do not expect to issue any contracts that reference U.S. dollar LIBOR after 2021. We will need to considernew contracts issued before the end of 2021 to determine if they should reference an alternative benchmark rate and/or include suggested fallbacklanguage, as published by the ARRC. The consequences of these developments with respect to LIBOR cannot be entirely predicted and spanmultiple future periods; however, they could result in a change in the cost of our variable rate debt or derivative financial instruments, which may bedetrimental to our financial position or operating results.

We have unfunded and underfunded pension plan liabilities. We will require future operating cash flow to fund these liabilities. We haveno assurance that we will generate sufficient cash to satisfy these obligations.

We maintain U.S. and non-U.S. defined benefit pension plans covering current and former employees who meet or met age and servicerequirements. Our net pension liability and cost is materially affected by the discount rate used to measure pension obligations, the longevity andactuarial profile of our workforce, the level of plan assets available to fund those obligations and the actual and expected long-term rate of return onplan assets. Significant changes in investment performance or a change in the portfolio mix of invested assets can result in corresponding increasesand decreases in the valuation of plan assets or in a change in the expected rate of return on plan assets. Assets available to fund the pensionbenefit obligation of the U.S. advance-funded pension plans at December 31, 2020, were approximately $1,001 million, or approximately 90% of themeasured pension projected benefit obligation on a U.S. GAAP basis. In addition, any changes in the discount rate, as well as actual returns on planassets, could result in a significant increase or decrease in the valuation of pension obligations, affecting the reported funded status of our pensionplans as well as the net periodic pension cost in the following years. Similarly, changes in the expected return on plan assets can result in significantchanges in the net periodic pension cost in the following years.

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Our ability to use tax credits and / or net operating losses to reduce future tax payments may be limited if there is a change in ownershipof Grace or if Grace does not generate sufficient taxable income or foreign source income for U.S. tax purposes. Our ability to use theseattributes is also subject to time limitations. Changes in tax laws and regulations may reduce their value and availability.

Our ability to utilize tax attributes including tax credits, future tax deductions, and net operating losses (“NOLs”), is dependent on our ability togenerate sufficient taxable income and foreign source income for U.S. tax purposes. Under U.S. income tax law, federal tax credits may be carriedforward for 10 years, and research and development tax credits may be carried forward for 20 years. State NOL carryforwards are generallyavailable for deduction against future taxable income for up to 20 years, subject to state-specific regulations. Also, our ability to realize the benefitsof these tax credits and/or NOLs and their value may be adversely affected by changes in tax laws and regulations. In addition, our ability to utilizeU.S. federal tax credits as well as U.S. federal and state NOLs may be limited in the event of future changes in the ownership of outstandingCompany common stock.

Our business and stock price could be negatively impacted as a result of actions by activist shareholders or others.

We value constructive input from investors and regularly engage in dialogue with our shareholders regarding strategy and performance. OurBoard of Directors and management team are committed to acting in the best interests of all of our shareholders. Activist shareholders may fromtime to time engage in proxy solicitations, advance shareholder proposals, or otherwise attempt to effect changes or acquire control of Grace.Recently, we received a revised proposal from a shareholder to acquire Grace. Our Board of Directors responded that we are willing to discuss asale of Grace in the context of our ongoing review of strategic alternatives and that any transaction would need to be at a price level that reflects thefull value of Grace for its shareholders.

Actions of activist shareholders could affect our business because responding to such actions can be costly and time-consuming and disruptiveto our operations, and may divert the attention of our Board of Directors, management and employees. Moreover, such actions may createperceived uncertainties among current and potential customers, suppliers, employees and other constituencies as to our future direction, whichcould result in lost sales and the loss of business opportunities and make it more difficult to attract and retain qualified directors, personnel, andbusiness partners. In addition, actual or perceived actions of activist shareholders may cause significant fluctuations in our stock price that do notnecessarily reflect the underlying fundamentals and value of our business.

Item1B.UNRESOLVEDSTAFFCOMMENTS

None.

Item2.PROPERTIES

We operate manufacturing plants and other facilities (including offices, warehouses, labs and other service facilities) throughout the world.Some of these plants and facilities are shared by our reportable segments. We consider our operating properties generally to be in good operatingcondition and suitable for their current use. We believe that the productive capacity of our plants and other facilities, supplemented by tollingarrangements, is

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generally adequate for current operations. The table below summarizes our manufacturing plants by reportable segment and region as ofDecember 31, 2020:

NumberofFacilities(1)

NorthAmericaEuropeMiddleEast

Africa(EMEA) AsiaPacific LatinAmerica TotalCatalysts Technologies 10 3 1 — 14 Owned 8 1 1 — 10 Leased 2 2 — — 4

Materials Technologies 4 2 1 1 8 Owned 3 1 1 1 6 Leased 1 1 — — 2

___________________________________________________________________________________________________________________

(1) Shared facilities are counted in both reportable segments. The total number of facilities included in the above table, without regard to sharing betweenreportable segments, is 19, of which we own 13 and lease 6.

Generally, we own the machinery and equipment at our manufacturing plants. We also own the land on which most of our largestmanufacturing plants are situated; however, certain manufacturing plants are located on leased land, normally long-term. We own our CorporateHeadquarters in Columbia, Maryland. We also lease and operate a shared services facility in Manila, Philippines.

The table below sets forth our manufacturing plants by reportable segment.

CatalystsTechnologies MaterialsTechnologiesAiken, South Carolina Dueren, Germany*Baton Rouge, Louisiana* East Chicago, Indiana*Chattanooga, Tennessee Hesperia, CaliforniaChicago, Illinois Kuantan, MalaysiaLake Charles, Louisiana Sorocaba, BrazilNorco, Louisiana*Pasadena, TexasStenungsund, Sweden* SharedTarragona, Spain* Albany, OregonValleyfield, Quebec, Canada Curtis Bay, MarylandYeosu, South Korea Worms, Germany___________________________________________________________________________________________________________________

* Denotes leased site.

Our three largest manufacturing sites are: Worms, in Germany; and Curtis Bay, Maryland, and Lake Charles, Louisiana, in the United States.The unanticipated loss of any of our manufacturing, headquarters, or shared services facilities could have a material adverse effect upon ourbusiness, financial condition or results of operations.

For information on our properties and equipment by region and country, see disclosure set forth in Item 8 (Financial Statements andSupplementary Data) under Note 18 (Segment Information) to our Consolidated Financial Statements, which disclosure is incorporated herein byreference.

Item3.LEGALPROCEEDINGS

CHAPTER11PROCEEDINGSANDASBESTOSCLAIMS

Disclosures provided in this Report in Item 1 (Business) and Item 8 (Financial Statements and Supplementary Data) under Note 10(Commitments and Contingent Liabilities, under the caption “Legacy Liabilities”) to the Consolidated Financial Statements, are incorporated hereinby reference.

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ENVIRONMENTALINVESTIGATIONSANDCLAIMS

Disclosures provided in this Report in Item 1 (Business) under the caption “Environment, Health, Safety, and Security Matters” and Item 8(Financial Statements and Supplementary Data) under Note 10 (Commitments and Contingent Liabilities, under the caption “Legacy EnvironmentalLiabilities”) to the Consolidated Financial Statements, are incorporated herein by reference.

Item4.MINESAFETYDISCLOSURES

Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reformand Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is included in Exhibit 95 to this Report.

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INFORMATIONABOUTOUREXECUTIVEOFFICERS

Pursuant to General Instruction G(3) of Form 10-K, the following list of executive officers of Grace as of February 15, 2021, is included as anunnumbered Item in Part I of this report in lieu of being included in the Grace Proxy Statement relating to the 2021 Annual Meeting of Shareholders.Our executive officers are elected annually.

NameandAge Office FirstElectedHudson La Force (56) President and Chief Executive Officer

DirectorNovember 8, 2018 November 2, 2017

William C. Dockman (61) Senior Vice President and Chief Financial Officer May 8, 2019Elizabeth C. Brown (57) Senior Vice President and Chief Human Resources Officer January 21, 2015Keith N. Cole (62) Senior Vice President, Public Affairs and Environment, Health, Safety, and Chief

Sustainability OfficerFebruary 10, 2014

Cherée H. Johnson (45) Senior Vice President, General Counsel and Secretary January 11, 2021

Mr. La Force, Ms. Brown, and Mr. Cole have been actively engaged in Grace’s business as executive officers for the past five years. Mr. LaForce is Grace’s Principal Executive Officer.

Mr. Dockman joined Grace in 1999. From 2012 until he became an executive officer, Mr. Dockman was Grace’s Vice President—Finance,Controller and Chief Accounting Officer. Mr. Dockman is Grace’s Principal Financial Officer and its Principal Accounting Officer.

Ms. Johnson joined Grace in 2021. From 2015 until Ms. Johnson became an executive officer of Grace, she was Deputy General Counsel andAssistant Corporate Secretary with McCormick & Company, Incorporated.

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PARTII

Item5.MARKETFORREGISTRANT’SCOMMONEQUITY,RELATEDSHAREHOLDERMATTERSANDISSUERPURCHASESOFEQUITYSECURITIES

Except as provided below, the disclosure required by this Item appears in this Report in: Item 6 (Selected Financial Data) opposite the caption“Other Statistics—Common shareholders of record”; Item 8 (Financial Statements and Supplementary Information) in Note 14 (Shareholders’Equity) and Note 21 (Quarterly Financial Information (Unaudited)) opposite the caption “Dividends declared per share” to the Consolidated FinancialStatements; and Item 12 (Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters), and suchdisclosure is incorporated herein by reference.

COMPANYCOMMONSTOCK

The principal market for Company common stock is the New York Stock Exchange, under the symbol GRA.

DIVIDENDSONCOMPANYCOMMONSTOCK

On February 8, 2021, we announced that our Board of Directors had approved an increase to the annual cash dividend rate, from $1.20 to$1.32 per share of Company common stock. We expect to continue growing our dividend as part of our disciplined capital allocation strategy.

Although our credit agreement and indentures (as described in Item 8 (Financial Statements and Supplementary Data) under Note 5 (Debt) tothe Consolidated Financial Statements and filed as an exhibit to this Report) contain certain restrictions on the payment of dividends on, andredemptions of, equity interests and other restricted payments, we believe that such restrictions do not currently materially limit our ability to paydividends. Any determination to pay cash dividends in the future may be affected by business and market conditions, our views on potential futurecapital requirements, the restrictions noted above and those that may be imposed by applicable law, covenants contained in any agreements wemay enter into in the future and changes in federal income tax law.

SHAREREPURCHASES

On February 8, 2017, we announced that our Board of Directors had authorized a share repurchase program of up to $250 million. OnFebruary 28, 2020, we announced that our Board of Directors had increased its share repurchase authorization to $250 million, includingapproximately $83 million remaining under the previously announced program. Repurchases under the programs may be made through one or moreopen market transactions at prevailing market prices; unsolicited or solicited privately negotiated transactions; accelerated share repurchaseprograms; or through any combination of the foregoing, or in such other manner as determined by management. The timing of the repurchases andthe actual amount repurchased will depend on a variety of factors, including the market price of the Company’s shares, strategic priorities for thedeployment of capital, and general market and economic conditions. We temporarily suspended our share repurchase program in early March 2020in light of the COVID-19 pandemic. We expect to resume our share repurchase program in 2021.

During the three months ended December 31, 2020, there were no repurchases of Company common stock by or on behalf of Grace or any“affiliated purchaser,” as reflected in the following table:

Totalnumberofsharespurchased

(#)

Averagepricepaidpershare

($/share)

Totalnumberofsharespurchasedaspartofpubliclyannouncedplansorprograms

(#)

Approximatedollarvalueofsharesthatmayyetbe

purchasedundertheplansorprograms

($inmillions)10/1/2020 - 10/31/2020 — — — 235.0 11/1/2020 - 11/30/2020 — — — 235.0 12/1/2020 - 12/31/2020 — — — 235.0 Total — — —

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STOCKPERFORMANCEGRAPH

The following information in Item 5 is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14Cunder the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or to the liabilities of Section 18 of the Exchange Act, and will not bedeemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extentGrace specifically incorporates it by reference into such a filing.

The line graph and table below compare the cumulative total shareholder return on Company common stock with the cumulative total return ofcompanies on the Standard & Poor’s (“S&P”) 500 Stock Index, the S&P Composite 1500 Specialty Chemicals Index and S&P 1500 DiversifiedChemicals Index. This graph and table assume the investment of $100 in Company common stock on December 31, 2015. Cash dividends paid in2016 through 2020 are assumed reinvested for the graph and table below.

2015 2016 2017 2018 2019 2020W. R. Grace & Co.(1) $ 100 $ 85 $ 89 $ 84 $ 92 $ 74 S&P 500 Index 100 112 136 130 171 203 S&P 1500 Specialty Chemicals 100 112 140 132 156 181 S&P 1500 Diversified Chemicals 100 115 150 114 101 136 ___________________________________________________________________________________________________________________

(1) W. R. Grace & Co. stock value at December 31, 2015, reflects the adjusted post-Separation market value.

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Item6.SELECTEDFINANCIALDATA

(Inmillions,exceptpershareamountsandshareholders) 2020 2019 2018 2017 2016StatementofOperationsNet sales $ 1,729.8 $ 1,958.1 $ 1,932.1 $ 1,716.5 $ 1,598.6 Income (loss) from continuing operations(1)(2) (1.7) 126.7 166.8 10.4 107.0 FinancialPositionTotal assets 3,765.5 3,932.6 3,565.3 2,907.0 2,911.8 Debt payable after one year 1,975.1 1,957.3 1,961.0 1,523.8 1,507.6 Shareholders’ equity 234.5 402.2 337.0 263.3 372.4 DataPerCommonShareIncome (loss) from continuing operations—basic $ (0.03) $ 1.89 $ 2.49 $ 0.16 $ 1.53 Income (loss) from continuing operations—diluted (0.03) 1.89 2.49 0.16 1.52 Dividends declared 1.20 1.08 0.96 0.84 0.51 OtherStatisticsCommon shareholders of record 3,423 3,749 4,369 4,646 4,895 ___________________________________________________________________________________________________________________

(1) Adjustments related to our legacy liabilities and pension mark-to-market accounting are included in and affect the period-to-period comparability of“income (loss) from continuing operations” and the related data per common share. See Note 18 to the Consolidated Financial Statements for a detailof these items.

(2) For 2017, “Income (loss) from continuing operations” includes a charge of $143.0 million related to the estimated impacts of the U.S. Tax Cuts andJobs Act of 2017.

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Item7.MANAGEMENT’SDISCUSSIONANDANALYSISOFFINANCIALCONDITIONANDRESULTSOFOPERATIONS

See “Analysis of Operations” for a discussion of our non-GAAP performance measures. Our references to “advanced economies” and“emerging regions” refer to classifications established by the International Monetary Fund.

ResultsofOperations

2020 Performance Summary

Following is a summary of our financial performance for the year ended December 31, 2020, compared with the prior year.

• Net sales decreased 11.7% to $1,729.8 million.

• Net loss attributable to Grace shareholders was $1.8 million.

• Adjusted EBIT decreased 34.0% to $312.2 million.

• Diluted loss per share was $0.03 per diluted share.

• Adjusted EPS decreased 39.7% to $2.64 per diluted share.

Non-GAAP performance measures further discussed below.

Summary Description of Business

We are engaged in specialty chemicals and specialty materials businesses on a worldwide basis through our two reportable segments, GraceCatalysts Technologies and Grace Materials Technologies. See Item 1 (Business—Business Overview) of this Report for a summary description ofour business.

Analysis of Operations

We have set forth in the table below our key operating statistics with percentage changes for the years ended December 31, 2020, 2019, and2018. Please refer to this Analysis of Operations when reviewing this Management’s Discussion and Analysis of Financial Condition and Results ofOperations. In the table we present financial information in accordance with U.S. GAAP, as well as the non-GAAP financial information describedbelow. We believe that the non-GAAP financial information provides useful supplemental information about the performance of our businesses,improves period-to-period comparability, and provides clarity on the information our management uses to evaluate the performance of ourbusinesses. In the table, we have provided reconciliations of these non-GAAP financial measures to the most directly comparable financial measurecalculated and presented in accordance with U.S. GAAP. The non-GAAP financial measures should not be considered as a substitute for financialmeasures calculated in accordance with U.S. GAAP, and the financial results calculated in accordance with U.S. GAAP and reconciliations fromthose results should be evaluated carefully.

We define Adjusted EBIT (a non-GAAP financial measure) to be net income attributable to W. R. Grace & Co. shareholders adjusted forinterest income and expense; income taxes; costs related to legacy matters; restructuring and repositioning expenses and asset impairments;pension costs other than service and interest costs, expected returns on plan assets, and amortization of prior service costs/credits; gains andlosses on sales and exits of businesses, product lines, and certain other investments; third-party acquisition-related costs and the amortization ofacquired inventory fair value adjustment; gains and losses on modification or extinguishment of debt; the effects of these items on equity in earningsof unconsolidated affiliate; and certain other items that are not representative of underlying trends.

We define Adjusted EBITDA (a non-GAAP financial measure) to be Adjusted EBIT adjusted for depreciation and amortization, anddepreciation and amortization included in equity in earnings of unconsolidated affiliate (collectively, Adjusted Depreciation and Amortization).

We define Adjusted EBIT Return on Invested Capital (a non-GAAP financial measure) to be Adjusted EBIT (on a trailing four quarters basis)divided by Adjusted Invested Capital, which is defined as equity adjusted for

1

1

1

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debt; underfunded and unfunded defined benefit pension plans; liabilities related to legacy matters; cash, cash equivalents, and restricted cash; netincome tax assets; and certain other assets and liabilities.

We define Adjusted Gross Margin (a non-GAAP financial measure) to be gross margin adjusted for pension-related costs included in cost ofgoods sold, the amortization of acquired inventory fair value adjustment, and write-offs of inventory related to exits of businesses and product linesand significant manufacturing process changes.

We define Adjusted Earnings Per Share (EPS) (a non-GAAP financial measure) to be diluted EPS adjusted for costs related to legacy matters;restructuring and repositioning expenses and asset impairments; pension costs other than service and interest costs, expected returns on planassets, and amortization of prior service costs/credits; gains and losses on sales and exits of businesses, product lines and certain otherinvestments; third-party acquisition-related costs and the amortization of acquired inventory fair value adjustment; gains and losses on modificationor extinguishment of debt; certain other items that are not representative of underlying trends; certain discrete tax items; and income tax expenserelated to historical tax attributes.

We define the change in net sales on a constant currency basis (a non-GAAP financial measure) to be the period-over-period change in netsales calculated using the foreign currency exchange rates that were in effect during the previous comparable period.

“Legacy matters” include legacy (i) product, (ii) environmental, and (iii) other liabilities, relating to past activities of Grace.

In the 2020 first quarter, the definition of Adjusted EBIT was modified to adjust for the effects of interest and taxes on equity in earnings ofunconsolidated affiliate. The definition of Adjusted EBITDA was modified to adjust for the effects of depreciation and amortization on equity inearnings of unconsolidated affiliate. We made these changes to provide clarity about the impacts of these items on our equity in earnings ofunconsolidated affiliate and to improve consistency in our application of non-GAAP financial measures. Previously reported amounts were revised toconform to the current presentation.

We use Adjusted EBIT as a performance measure in significant business decisions and in determining certain incentive compensation. Weuse Adjusted EBIT as a performance measure because it provides improved period-to-period comparability for decision making and compensationpurposes, and because it better measures the ongoing earnings results of our strategic and operating decisions by excluding the earnings effects ofour legacy matters; restructuring and repositioning activities; certain acquisition-related items; and certain other items that are not representative ofunderlying trends.

We use Adjusted EBITDA, Adjusted EBIT Return on Invested Capital, Adjusted Gross Margin, and Adjusted EPS as performance measuresand may use these measures in determining certain incentive compensation. We use Adjusted EBIT Return on Invested Capital in making operatingand investment decisions and in balancing the growth and profitability of our operations.

We use the change in net sales on a constant currency basis as a performance measure to compare current period financial performance tohistorical financial performance by excluding the impact of foreign currency exchange rate fluctuations that are not representative of underlyingbusiness trends and are largely outside of our control.

Adjusted EBIT, Adjusted EBITDA, Adjusted EBIT Return on Invested Capital, Adjusted Gross Margin, Adjusted EPS, and the change in netsales on a constant currency basis are non-GAAP financial measures; do not purport to represent income measures as defined under U.S. GAAP;and should not be used as alternatives to such measures as an indicator of our performance. These measures are provided to investors and othersto improve the period-to-period comparability and peer-to-peer comparability of our financial results, and to ensure that investors understand theinformation we use to evaluate the performance of our businesses. They distinguish the operating results of Grace’s current business base from thecosts of Grace’s legacy matters; restructuring and repositioning activities; and certain other items. These measures may have material limitationsdue to the exclusion or inclusion of amounts that are included or excluded, respectively, in the most directly comparable measures calculated andpresented in accordance with U.S. GAAP, and thus investors and others should review carefully our financial results calculated in accordance withU.S. GAAP.

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Adjusted EBIT has material limitations as an operating performance measure because it excludes costs related to legacy matters, and mayexclude income and expenses from restructuring, repositioning, and other activities, which historically have been material components of our netincome. Adjusted EBITDA also has material limitations as an operating performance measure because it excludes the impact of depreciation andamortization expense. Our business is substantially dependent on the successful deployment of capital, and depreciation and amortization expenseis a necessary element of our costs. We compensate for the limitations of these measurements by using these indicators together with net incomeas measured under U.S. GAAP to present a complete analysis of our results of operations. Adjusted EBIT and Adjusted EBITDA should beevaluated together with net income and net income attributable to Grace shareholders, measured under U.S. GAAP, for a complete understandingof our results of operations.

AnalysisofOperations(Inmillions,exceptpershareamounts)

YearEndedDecember31,2020 2019 %Change 2018 %Change

Netsales:Catalysts Technologies $ 1,271.4 $ 1,496.7 (15.1)% $ 1,463.5 2.3 %Materials Technologies 458.4 461.4 (0.7)% 468.6 (1.5)%TotalGracenetsales $ 1,729.8 $ 1,958.1 (11.7)% $ 1,932.1 1.3 %Netsalesbyregion:North America $ 508.4 $ 597.8 (15.0)% $ 581.7 2.8 %Europe Middle East Africa 721.0 791.6 (8.9)% 752.2 5.2 %Asia Pacific 413.5 475.4 (13.0)% 481.5 (1.3)%Latin America 86.9 93.3 (6.9)% 116.7 (20.1)%Totalnetsalesbyregion $ 1,729.8 $ 1,958.1 (11.7)% $ 1,932.1 1.3 %Performancemeasures:AdjustedEBIT(A):Catalysts Technologies segment operating income $ 309.6 $ 466.4 (33.6)% $ 440.9 5.8 %Materials Technologies segment operating income 85.0 97.8 (13.1)% 105.6 (7.4)%Corporate costs (68.0) (72.7) 6.5 % (73.5) 1.1 %Certain pension costs(B)(C) (14.4) (18.4) 21.7 % (15.9) (15.7)%AdjustedEBIT 312.2 473.1 (34.0)% 457.1 3.5 %Pension MTM adjustment and other related costs, net(B)(C) (94.6) (85.9) 15.2 Loss on early extinguishment of debt (39.4) — (4.8)Costs related to legacy matters (39.4) (103.5) (82.3)Restructuring and repositioning expenses attributable to W. R. Grace & Co.

shareholders (36.9) (13.7) (46.4)Inventory write-offs and disposal costs(D) (20.7) (3.6) — Third-party acquisition-related costs (5.2) (3.6) (7.3)Taxes and interest included in equity in earnings of unconsolidated affiliate (0.7) 0.1 (0.4)Benefit plan adjustment — (5.0) — Amortization of acquired inventory fair value adjustment — — (6.9)Interest expense, net (74.9) (74.8) (0.1)% (78.5) 4.7 %(Provision for) benefit from income taxes (2.2) (56.8) 96.1 % (78.1) 27.3 %Netincome(loss)attributabletoW.R.Grace&Co.shareholders $ (1.8) $ 126.3 (101.4)% $ 167.6 (24.6)%DilutedEPS $ (0.03) $ 1.89 (101.6)% $ 2.49 (24.1)%AdjustedEPS $ 2.64 $ 4.38 (39.7)% $ 4.14 5.8 %

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AnalysisofOperations(Inmillions)

YearEndedDecember31,2020 2019 %Change 2018 %Change

Adjustedperformancemeasures:GrossMargin:Catalysts Technologies 39.2 % 42.8 % (3.6) pts 41.7 % 1.1 ptsMaterials Technologies 33.6 % 36.5 % (2.9) pts 37.8 % (1.3) ptsAdjusted Gross Margin 37.7 % 41.4 % (3.7) pts 40.7 % 0.7 ptsInventory write-offs(D) (1.2)% (0.2)% (1.0) pts — % (0.2) ptsPension in cost of goods sold (0.9)% (0.7)% (0.2) pts (0.7)% — ptsAmortization of acquired inventory fair value adjustment — % — % — pts (0.3)% 0.3 ptsTotal Grace 35.6 % 40.5 % (4.9) pts 39.7 % 0.8 ptsAdjustedEBIT:Catalysts Technologies $ 309.6 $ 466.4 (33.6)% $ 440.9 5.8 %Materials Technologies 85.0 97.8 (13.1)% 105.6 (7.4) %Corporate, pension, and other (82.4) (91.1) 9.5 % (89.4) (1.9) %Total Grace $ 312.2 $ 473.1 (34.0)% $ 457.1 3.5 %Depreciationandamortization:Catalysts Technologies depreciation and amortization $ 85.3 $ 81.9 4.2 % $ 81.7 0.2 %Depreciation and amortization included in equity in earnings of

unconsolidated affiliate 3.3 0.5 NM 0.5 — %Catalysts Technologies 88.6 82.4 7.5 % 82.2 0.2 %Materials Technologies 15.0 14.2 5.6 % 15.5 (8.4) %Corporate 4.7 4.2 11.9 % 3.6 16.7 %Adjusted Depreciation and Amortization 108.3 100.8 7.4 % 101.3 (0.5) %Depreciation and amortization included in equity in earnings of

unconsolidated affiliate (3.3) (0.5) NM (0.5) — %Total Grace $ 105.0 $ 100.3 4.7 % $ 100.8 (0.5) %AdjustedEBITDA:Catalysts Technologies $ 398.2 $ 548.8 (27.4)% $ 523.1 4.9 %Materials Technologies 100.0 112.0 (10.7)% 121.1 (7.5) %Corporate, pension, and other (77.7) (86.9) 10.6 % (85.8) (1.3) %Total Grace $ 420.5 $ 573.9 (26.7)% $ 558.4 2.8 %AdjustedEBITmargin:Catalysts Technologies 24.4 % 31.2 % (6.8) pts 30.1 % 1.1 ptsMaterials Technologies 18.5 % 21.2 % (2.7) pts 22.5 % (1.3) ptsTotal Grace 18.0 % 24.2 % (6.2) pts 23.7 % 0.5 ptsNetincomemargin (0.1)% 6.5 % (6.6) pts 8.7 % (2.2) ptsAdjustedEBITDAmargin:Catalysts Technologies 31.3 % 36.7 % (5.4) pts 35.7 % 1.0 ptsMaterials Technologies 21.8 % 24.3 % (2.5) pts 25.8 % (1.5) ptsTotal Grace 24.3 % 29.3 % (5.0) pts 28.9 % 0.4 pts

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AnalysisofOperations(Inmillions)


CalculationofAdjustedEBITReturnOnInvestedCapital(trailingfourquarters):Net Income $ (1.8) $ 126.3 $ 167.6 Adjusted EBIT 312.2 473.1 457.1 ReconciliationtoAdjustedInvestedCapital:Totalequity 234.5 402.2 337.0 Debt 1,990.4 1,980.4 1,983.3 Underfunded and unfunded defined benefit pension plans 649.0 519.8 433.1 Liabilities related to legacy matters 224.1 206.7 126.9 Cash, cash equivalents, and restricted cash (306.2) (282.9) (201.0)Net income tax assets (555.3) (501.6) (517.3)Other items 13.7 19.7 21.6 AdjustedInvestedCapital $ 2,250.2 $ 2,344.3 $ 2,183.6

GAAPReturnonEquity (0.8)% 31.4 % 49.7 %AdjustedEBITROIC 13.9 % 20.2 % 20.9 %___________________________________________________________________________________________________________________

Amounts may not add due to rounding.NM—Not Meaningful(A) Grace’s segment operating income includes only Grace’s share of income of consolidated and unconsolidated joint ventures.(B) Certain pension costs include only ongoing costs recognized quarterly, which include service and interest costs, expected returns on plan assets, and

amortization of prior service costs/credits. Catalysts Technologies and Materials Technologies segment operating income and corporate costs do notinclude any amounts for pension expense. Other pension-related costs including annual mark-to-market (MTM) adjustments and actuarial gains andlosses are excluded from Adjusted EBIT. These amounts are not used by management to evaluate the performance of Grace’s businesses andsignificantly affect the peer-to-peer and period-to-period comparability of our financial results. Mark-to-market adjustments and actuarial gains andlosses relate primarily to changes in financial market values and actuarial assumptions and are not directly related to the operation of Grace’sbusinesses.

(C) “Defined benefit pension expense” as measured under U.S. GAAP includes actuarial gains and losses and actual returns on assets. Adjusted EBITincludes expected returns on assets but excludes both actuarial gains and losses and actual returns on assets. The table below presents expected andactual returns on plan assets for U.S. and non-U.S. plans for the years ended December 31, 2020, 2019, and 2018.

2020 2019 2018(Inmillions) U.S.Plans Non-U.S.Plans U.S.Plans Non-U.S.Plans U.S.Plans Non-U.S.PlansActual return on plan assets $ 115.7 $ 2.3 $ 154.6 $ 4.1 $ (41.9) $ (1.7)Actual return on plan assets 13.00 % 9.02 % 18.90 % 20.00 % (3.51)% (8.01)%Expected return on plan assets $ 48.3 $ 1.0 $ 48.2 $ 0.9 $ 57.2 $ 1.0 Expected return on plan assets 5.25 % 4.17 % 5.75 % 4.43 % 5.25 % 4.69 %

(D) Inventory write-off in 2020 related to the changes in hydroprocessing catalysts manufacturing operations. Inventory write-off in 2019 related to theidling of Grace’s methanol-to-olefins manufacturing facility.

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Grace Overview

Following is an overview of our financial performance for the years ended December 31, 2020, 2019, and 2018.

Impact of COVID-19 Pandemic and Recession

The COVID-19 pandemic has led to significantly lower transportation fuel demand and a reduction in refining activity, which has negativelyaffected demand for our refining catalysts. Demand for manufactured products, including polyolefin resins and products made with our specialtysilicas, has also declined and negatively affected demand for our polyolefin catalysts and specialty silicas.

While COVID-19 had a significant negative impact on our financial results for 2020, we are well positioned to meet the operational and financialchallenges caused by the pandemic until the economy recovers. Our first priority is the health and safety of our employees. We have fullyimplemented our pandemic response plan, including significant new safety protocols throughout our operations. We are also focused on businesscontinuity to ensure we continue delivering value to all of our customers. Our workforce remains safe and healthy, and we have experienced nobusiness continuity issues in our global operations or supply chain. Approximately 45% of our global workforce shifted to working remotely beginningin March 2020.

We took decisive actions to mitigate the economic effects of the pandemic to ensure we generated strong cash flow in 2020, including loweringcapital spending, improving working capital to generate cash flow, reducing operating costs, and aligning production volumes to match near-termdemand.

Understanding near-term demand in our operating segments is critically important to effectively managing our operations, working capital, andcosts. We are triangulating customer information, economic and industry data, inventory levels, and our own experience to plan our operations. For2021:

• Specialty catalysts demand is expected to continue to improve through the year on strong consumer demand and continued strength ofour UNIPOL Polypropylene Process Technology licensing business;

• Materials Technologies demand is expected to grow year over year on continued strength of pharma/consumer and coatings, as well asfurther recovery in chemical process demand; and

• FCC catalysts demand is expected to improve sequentially throughout the year and approach pre-pandemic levels by the end of theyear. Transportation fuel demand and refinery utilization still remain below normal levels for the industry, and the effects of thepandemic are expected to continue to be a headwind until demand more fully recovers.

The above does not assume a double dip recession or a resurgence in the pandemic. See Item 1A. (Risk Factors) in Part I of this Report formore information on the risks we face related to the COVID-19 pandemic. With respect to the above information regarding our expectations for 2021and other statements regarding future events, see “Forward-Looking Statements,” above.

Impact of Hurricane Laura

During the third quarter, Hurricane Laura caused severe and widespread damage to Lake Charles, Louisiana, and surrounding communities,including catastrophic damage to the regional power grid. To ensure continuity of supply for our customers, our Lake Charles refining catalystsmanufacturing facility established a temporary on-site 20MW power generation capability. During the power outage, customer demand was met frominventory in Lake Charles and by shifting FCC and hydroprocessing catalysts production to other manufacturing facilities, which increased ouroperating costs. This created no significant impact to our customers. While this is an insured event, the total costs do not exceed our deductible.

Event-related costs were approximately $19 million. The costs, included in Catalysts Technologies segment operating income, were primarilyrelated to on-site power generation, incremental operations and logistics costs to supply customers during the outage, temporary housing andemployee assistance, and property damage and clean-up.

®

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Discrete Items Impacting 2019

Four discrete items (the “Discrete Items”) impacted 2019 full-year results:

• Refining Technologies: an FCC catalysts customer’s bankruptcy following a fire resulting in the closure of its refinery;• Specialty Catalysts: a customer-specific inventory correction in the second half of 2019;• Specialty Catalysts: customer-specific temporary reductions in operating rates and catalyst usage due to reduced feedstock supplyfollowing an attack in the Middle East; and

• Materials Technologies: an equipment failure in one of our silicas manufacturing lines (operations fully restored by mid-July).

These Discrete Items reduced 2019 full-year net sales by approximately $36 million. These Discrete Items also reduced pretax income andAdjusted EBIT by approximately $36 million. The earnings effect included lost margin on lower sales, the costs of adjusting our manufacturingoperations in response to lower demand, costs incurred to serve customers and minimize any impact to their operations, and costs related to theFCC catalysts customer bankruptcy. These effects were partially mitigated by an approximately $12 million benefit from cost-reduction activities inresponse to these events and $8 million of business interruption proceeds from the FCC catalyst customer event, resulting in a net reduction to 2019pretax income of approximately $16 million. We received insurance recoveries of an additional $16.3 million in the first half of 2020 under ourbusiness interruption insurance policy. This claim has been fully resolved.

Net Sales and Gross Margin

Sales for 2020 decreased 11.7% overall and on constant currency compared with the prior year. The decrease was driven by lower salesvolumes resulting primarily from the COVID-19 pandemic, partially offset by improved pricing in both segments. Lower sales volumes in CatalystsTechnologies were primarily due to lower demand for global transportation fuels and refinery operating rates driven by the COVID-19 pandemic andrecession and a generally weaker manufacturing environment during the 2020 first quarter. In Materials Technologies, growth in pharma/consumerend markets was offset by weakness in chemical process end markets.

Gross margin decreased 490 basis points to 35.6% from 40.5% for the prior year. Adjusted Gross Margin decreased 370 basis points to 37.7%from 41.4% for the prior year. The decreases were primarily driven by under-absorbed fixed costs resulting from lower production volumes andinventory reductions, partially offset by improved product mix and cost mitigation actions. Strong sequential improvement in the second half of theyear was primarily driven by higher production rates.

Sales for 2019 increased 1.3% overall compared with the prior year, up 3.0% on constant currency. The increase was driven by improvedpricing in both segments and all regions. Higher sales volumes in Catalysts Technologies were driven by Specialty Catalyst growth in EMEA andAsia Pacific and the 2018 second quarter

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polyolefin catalysts acquisition, partially offset by the Discrete Items. Sales volume in Materials Technologies were up driven by growth in theAmericas, partially offset by a decline in Asia Pacific and EMEA.

Gross margin increased 80 basis points to 40.5% from 39.7% for the prior year. Adjusted Gross Margin increased 70 basis points to 41.4%from 40.7% for the prior year. Improved pricing, higher sales volumes, favorable mix, and lower depreciation were partially offset by highermanufacturing costs, including a 20 basis point impact related to higher raw materials and energy costs.

The following tables identify the year-over-year increase or decrease in sales attributable to changes in sales volume and/or mix, product price,and the impact of currency translation.

2020asaPercentageIncrease(Decrease)from2019

NetSalesVarianceAnalysis Volume PriceCurrencyTranslation Total

Catalysts Technologies (15.5)% 0.3 % 0.1 % (15.1)%Materials Technologies (0.6)% 0.3 % (0.4) % (0.7)%Net sales (12.0)% 0.3 % — % (11.7)%ByRegion:North America (15.1)% 0.1 % — % (15.0)%Europe Middle East Africa (10.7)% 1.3 % 0.5 % (8.9)%Asia Pacific (12.4)% (0.6)% — % (13.0)%Latin America (1.6)% (1.1)% (4.2) % (6.9)%

2019asaPercentageIncrease(Decrease)from2018

NetSalesVarianceAnalysis Volume PriceCurrencyTranslation Total

Catalysts Technologies 0.9 % 2.5 % (1.1) % 2.3 %Materials Technologies 0.3 % 1.9 % (3.7) % (1.5)%Net sales 0.6 % 2.4 % (1.7) % 1.3 %ByRegion:North America 0.2 % 2.6 % — % 2.8 %Europe Middle East Africa 6.0 % 3.0 % (3.8) % 5.2 %Asia Pacific (1.8)% 0.7 % (0.2) % (1.3)%Latin America (20.7)% 4.4 % (3.8) % (20.1)%

Grace Net Income

Net income (loss) attributable to Grace was $(1.8) million for 2020 compared with $126.3 million for the prior year. The decrease was primarilydue to lower gross profit including the write-off of obsolete inventory, a loss on early extinguishment of debt, and a write-off of previously capitalizedplant engineering and site costs, partially offset by a lower provision for income taxes including the benefit from income tax attributes and loweroperating

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expenses in 2020. The prior year included higher costs related to legacy matters, including higher charges related to the Libby, Montana, damspillway replacement project (see below) and a charge related to probable future payments with respect to our former ZAI product.

During the 2020 third quarter, we completed a review of contractor bids for the replacement of the upper portion of the dam spillway at theformer Libby, Montana, mine site and increased our cost estimate for the total project by $27.0 million, to $95.0 million. The prior-year periodincluded charges of $45.0 million related to these projects. The 2019 fourth quarter included additional charges of $23.0 million related to theseprojects. See Note 10 to the Consolidated Financial Statements for further discussion.

During the 2020 second quarter, we implemented changes to our Refining Technologies manufacturing operations and global footprint to drivecapital and operating efficiencies as well as support global growth.

Hydroprocessing Catalysts Manufacturing Operations: In connection with our ongoing operating excellence initiatives, we have accelerated theimplementation of the Grace Manufacturing System at our three hydroprocessing catalyst manufacturing sites, including optimization of plantprocesses and key organizational changes. Over time, these changes are expected to benefit operating margins in our ART joint venture. Anymargin benefits will be recognized through our equity earnings in the joint venture.

As a result of these changes, we recorded a pre-tax charge of $19.7 million in the 2020 second quarter, which is reflected in cost of goods sold,related to a write-off of inventory now deemed obsolete based on the process changes. The cash costs to dispose of this inventory areapproximately $1 million.

Middle East FCC Catalysts Plant: In agreement with our local joint venture partner, we have discontinued the previously announced project tobuild a full-scale FCC catalysts plant in the Middle East. The decision reflects the rapid advance of FCC catalysts technology and the value ofmaintaining flexibility in our global manufacturing operations to ensure we can supply the dynamic needs of our customers in a cost- and capital-efficient way. We will continue to invest in our existing manufacturing network to support new technology development and provide the flexibilityrequired to produce advanced catalyst and additive platforms.

In the 2020 second quarter, we recorded a pre-tax charge of $19.7 million to write off engineering and site costs. The expected cash costs toimplement this change are approximately $1 million.

Net income attributable to Grace was $126.3 million for 2019 compared with $167.6 million for the prior year. The decrease was primarily dueto a loss recorded for the annual pension mark-to-market adjustment and higher costs related to legacy matters, including charges of $68.0 millionfor the estimated costs of construction of a new dam spillway at our former vermiculite mine site and $24.0 million related to probable futurepayments with respect to our former ZAI product (see Note 10 to the Consolidated Financial Statements), partially offset by lower restructuring andrepositioning expenses, higher operating income from our Catalysts Technologies segment, and a lower provision for income taxes.

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Adjusted EBIT

Adjusted EBIT was $312.2 million for 2020, a decrease of 34.0% compared with the prior year primarily due to lower sales and gross profit, anapproximately $19 million impact from hurricane-related costs and lower income from our ART joint venture, partially offset by lower operatingexpenses.

Adjusted EBIT was $473.1 million for 2019, an increase of 3.5% compared with the prior year primarily due to higher sales and gross profitincluding the 2019 first quarter benefit of the polyolefin catalysts acquisition, partially offset by the net impact of the Discrete Items, lower incomefrom our ART joint venture, and unfavorable currency transaction effects.

Adjusted EPS

The following table reconciles our Diluted EPS (GAAP) to our Adjusted EPS (non-GAAP):

2020(Inmillions,exceptpershareamounts) Pre-Tax TaxEffect After-Tax PerShareDiluted Earnings Per Share $ (0.03)Pension MTM adjustment and other related costs, net $ 94.6 $ 22.6 $ 72.0 1.09 Loss on early extinguishment of debt 39.4 9.5 29.9 0.45 Costs related to legacy matters 39.4 9.5 29.9 0.45 Restructuring and repositioning expenses 36.9 8.7 28.2 0.43 Inventory write-offs and disposal costs 20.7 5.0 15.7 0.24 Third-party acquisition-related costs 5.2 1.3 3.9 0.06 Discrete tax items 3.1 (3.1) (0.05)Adjusted EPS $ 2.64

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2019(Inmillions,exceptpershareamounts) Pre-Tax TaxEffect After-Tax PerShareDiluted Earnings Per Share $ 1.89 Costs related to legacy matters $ 103.5 $ 25.2 $ 78.3 1.17 Pension MTM adjustment and other related costs, net 85.9 24.0 61.9 0.93 Restructuring and repositioning expenses 13.7 3.0 10.7 0.16 Benefit plan adjustment 5.0 1.1 3.9 0.06 Inventory write-offs and disposal costs 3.6 — 3.6 0.05 Third-party acquisition-related costs 3.6 0.9 2.7 0.04 Income tax expense related to historical tax attributes(1) (8.6) 8.6 0.13 Discrete tax items 3.6 (3.6) (0.05)Adjusted EPS $ 4.38 ___________________________________________________________________________________________________________________

(1) Our historical tax attribute carryforwards (net operating losses and tax credits) unfavorably affected our tax expense with respect to certain provisions ofthe Tax Cuts and Jobs Act (“TCJA”). To normalize the effective tax rate, an adjustment was made to eliminate the tax expense impact associated withthe historical tax attributes.

2018(Inmillions,exceptpershareamounts) Pre-Tax TaxEffect After-Tax PerShareDiluted Earnings Per Share $ 2.49 Costs related to legacy matters $ 82.3 $ 17.7 $ 64.6 0.96 Restructuring and repositioning expenses 46.4 10.0 36.4 0.54 Pension MTM adjustment and certain pension related costs (15.2) (3.4) (11.8) (0.18)Third-party acquisition-related costs 7.3 1.6 5.7 0.08 Amortization of acquired inventory fair value adjustment 6.9 1.5 5.4 0.08 Loss on early extinguishment of debt 4.8 1.0 $ 3.8 0.06 Income tax expense related to historical tax attributes(1) (25.6) 25.6 0.38 Provisional charge related to the U.S. Tax Cuts and Jobs Act of 2017 17.1 (17.1) (0.25)Discrete tax items 1.4 (1.4) (0.02)Adjusted EPS $ 4.14 ___________________________________________________________________________________________________________________

(1) Our historical tax attribute carryforwards (net operating losses and tax credits) unfavorably affected our tax expense with respect to certain provisions ofthe TCJA. To normalize the effective tax rate, an adjustment was made to eliminate the tax expense impact associated with the historical tax attributes.

Return on Equity and Adjusted EBIT Return On Invested Capital

Return on equity for 2020 was (0.8)% on a trailing four quarters basis, compared with 31.4% and 49.7% for 2019 and 2018, respectively, on

the same basis. The declines were due to lower net income in 2020 and 2019.

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Adjusted EBIT Return on Invested Capital for 2020 was 13.9% on a trailing four quarters basis, compared with 20.2% and 20.9% for 2019 and2018, respectively, on the same basis. The decline from 2019 to 2020 is due to lower Adjusted EBIT. The decline from 2019 to 2018 is primarily dueto increased growth capital investments that had not yet been placed into service. These assets were placed in service beginning in mid-2020 andwill support volume growth over the next few years. We expect Adjusted EBIT Return on Invested Capital to improve as we recover from thepandemic.

We manage our businesses with the objective of maximizing sales, earnings and cash flow over time. Doing so requires that we successfullybalance our growth, profitability and working capital and other investments to support sustainable, long-term financial performance. We use AdjustedEBIT Return On Invested Capital as a performance measure in evaluating operating results, in making operating and investment decisions, and inbalancing the growth and profitability of our businesses.

Segment Overview—Grace Catalysts Technologies

Following is an overview of the financial performance of Catalysts Technologies for the years ended December 31, 2020, 2019, and 2018.

Net Sales—Grace Catalysts Technologies

Sales were down 15.1% in 2020, or down 15.2% on constant currency, compared with the prior year. The decrease on a constant currencybasis was due to lower sales volumes, partially offset by improved pricing. Specialty Catalysts sales decreased 11.9%, primarily due to lower marketdemand and customer catalyst inventory corrections in response to the COVID-19 pandemic as well as order timing in our chemical catalystsbusiness. In 2020 we signed seven new UNIPOL polypropylene process technology licenses totaling approximately 2,800 kilotons of annual resincapacity, which will continue to drive long-term catalysts and donor sales. Refining Technologies sales decreased 17.9% due to the effects of thepandemic on global transportation fuels demand and refinery operating rates.

Gross profit was $497.9 million for 2020, a decrease of 22.4% compared with the prior year. Gross margin was 39.2% compared with 42.8%for the prior year, primarily driven by under-absorbed fixed costs resulting from lower production volumes and inventory reductions, partially offset bya 110 basis point benefit from lower raw materials and energy costs, improved pricing, and cost reduction actions to align manufacturing costs withdemand levels.

Sales were up 2.3% in 2019, or up 3.4% on constant currency, compared with the prior year. The increase on a constant currency basis wasdue to improved pricing in all regions and higher sales volumes, partially offset by lower sales volumes from the Discrete Items. The improvedpricing in both Refining Technologies and Specialty Catalysts was driven by our focused value-selling efforts. For the trailing 12 months endingDecember 31, 2019, FCC pricing was up over 200 basis points. Higher sales volumes in Catalysts Technologies were driven by Specialty Catalystsgrowth in EMEA and Asia Pacific and the 2018 second quarter polyolefin catalysts acquisition, partially offset by lower sales volumes from theDiscrete Items. In 2019, we signed six new UNIPOL Polypropylene Process Technology licenses totaling approximately 2,500 kilotons of annualresin capacity, which

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will continue to drive long-term catalysts and donor sales. Unfavorable currency translation affected both product groups as the U.S. dollarstrengthened, primarily against the euro, compared with the prior-year period.

Gross profit was $641.3 million for 2019, an increase of 5.1% compared with the prior year. Gross margin was 42.8% compared with 41.7% forthe prior year. The increases were primarily due to improved pricing, favorable mix, higher sales volumes, and lower depreciation, partially offset byhigher manufacturing costs including a 10 basis point impact related to higher raw materials and energy costs and the Discrete Items.

Segment Operating Income (SOI) and Margin—Grace Catalysts Technologies

Segment operating income was $309.6 million for 2020, a decrease of 33.6% compared with the prior year, primarily due to lower sales andgross profit, hurricane-related costs of approximately $19 million, and lower income from our ART joint venture. The ART joint venture contributed$13.5 million to operating income, a decrease of $14.3 million from the prior-year period. Segment operating margin for 2020 decreased to 24.4%, adecline of 680 basis points compared with the prior year.

Segment operating income was $466.4 million for 2019, an increase of 5.8% compared with the prior year, primarily due to higher sales andgross profit, and business interruption insurance recoveries, partially offset by lower income from our ART joint venture, higher operating expensesincluding from the polyolefin catalysts acquisition, unfavorable effects of currency exchange rates, and higher amortization. The ART joint venturecontributed $27.8 million to operating income, a decrease of $4.0 million from the prior-year period primarily due to an increase in expenses chargedto the joint venture by the partners. Segment operating margin for 2019 increased to 31.2%, an improvement of 110 basis points compared with theprior year.

In July 2019, a North American FCC catalysts customer filed for bankruptcy protection after announcing that it would not resume operationsfollowing a fire in its refinery. We received insurance recoveries of $16.3 million in the first half of 2020 under our business interruption insurancepolicy. Including the $8.0 million received in the 2019 fourth quarter, we received $24.3 million of insurance recoveries related to this event,reflecting approximately eight quarters of the impact of the incident on earnings. This claim has been fully resolved.

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Segment Overview—Grace Materials Technologies

Following is an overview of the financial performance of Materials Technologies for the years ended December 31, 2020, 2019, and 2018.

Net Sales—Grace Materials Technologies

Sales were down 0.7% in 2020, or down 0.3% on constant currency, compared with the prior year. The decrease on a constant currency basiswas due to lower sales volumes, partially offset by improved pricing. Strength in pharma/consumer end markets was offset by weakness acrosschemical process end-markets. Coatings sales decreased slightly for the year, with demand rebounding in the second half of the year afterpandemic-related weakness in the first half.

Gross profit was $154.0 million for 2020, a decrease of 8.7% compared with the prior year. Gross margin was 33.6% compared with 36.5% forthe prior year. The decrease in gross margin was primarily driven by under-absorbed fixed costs resulting from lower production volumes andinventory reductions, partially offset by favorable mix, a 90 basis point benefit from lower raw materials and energy costs, and cost reduction actionsto align manufacturing costs with demand levels.

Sales were down 1.5% in 2019, or up 2.2% on constant currency, compared with the prior year. The increase on a constant currency basis wasdue to improved pricing and higher sales volumes, partially offset by lower sales volumes from one of the Discrete Items. Pricing improved across allregions, driven by EMEA and the Americas. The increase in sales volumes was primarily driven by higher pharma/consumer sales in all regions,partially offset by lower coatings sales in Asia, EMEA, and North America. The pricing improvement and increased sales volumes were more thanoffset by unfavorable currency translation as the U.S. dollar strengthened, primarily against the euro, compared with the prior-year period. OurMaterials Technologies business segment is particularly sensitive to changes in the euro.

Gross profit was $168.6 million for 2019, a decrease of 4.7% compared with the prior year. Gross margin was 36.5% compared with 37.8% forthe prior year. The decrease in gross margin was primarily due to higher manufacturing costs including costs directly related to one of the DiscreteItems and 50 basis points related to higher raw materials and energy costs, partially offset by improved pricing and lower depreciation expense.

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Segment Operating Income (SOI) and Margin—Grace Materials Technologies

Segment operating income was $85.0 million for 2020, a decrease of 13.1% compared with the prior year, primarily due to lower gross profit,partially offset by lower operating expenses. Segment operating margin for 2020 decreased to 18.5%, a decline of 270 basis points compared withthe prior year.

Segment operating income was $97.8 million for 2019, a decrease of 7.4% compared with the prior year, primarily due to lower gross profit andhigher operating expenses, including the effects of one of the Discrete Items. Segment operating margin for 2019 decreased to 21.2%, a decline of130 basis points compared with the prior year.

Corporate Costs

Corporate costs include functional and other costs such as professional fees, incentive compensation, and insurance premiums. Corporatecosts for 2020 decreased 6.5% compared with the prior year, primarily due to lower functional and incentive compensation expenses.

Corporate costs for 2019 decreased 1.1% compared with the prior year, primarily due to lower incentive compensation expenses, partiallyoffset by higher employee-related costs.

Restructuring and Repositioning Expenses

Restructuring expenses for the years ended December 31, 2020, 2019, and 2018, were $1.9 million, $2.6 million, and $14.0 million,respectively. Expenses incurred in 2020 primarily related to changes in estimated contractual costs in connection with a 2018 plant exit. Expensesincurred in 2019 primarily related to severance costs pertaining to the idling of our methanol-to-olefins manufacturing facility and were substantiallypaid in 2019. Restructuring expenses incurred in 2018 primarily related to the closure of two smaller manufacturing plants, the activities from whichhave been moved to larger, more cost-effective plants as part of our strategy to capture synergies from our recent catalysts acquisitions.Substantially all costs related to the restructuring programs are

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expected to be paid by June 30, 2023, but could be paid earlier subject to negotiations around certain plant exit costs.

Repositioning expenses for the years ended December 31, 2020, 2019, and 2018, were $35.0 million, $11.1 million, and $32.4 million,respectively. Expenses incurred in 2020 included a $19.7 million charge to write off engineering and site costs as a result of the decision not to builda full-scale catalysts plant in the Middle East (see “Grace Overview” above). Repositioning expenses in 2020 also included $7.2 million in costsrelated to our review of strategic alternatives.

In 2020, 2019, and 2018, we incurred expenses related to a multi-year program to transform manufacturing and business processes to extendour competitive advantages and improve our cost position. Expenses in 2018 also included $11.7 million of severance and stock compensationcosts related to employee separations, and write-offs of $8.5 million of previously capitalized plant engineering costs as a result of terminating anexpansion project no longer necessary due to the polyolefin catalysts acquisition (see Note 20 to the Consolidated Financial Statements). Excludingasset write-offs and stock compensation costs, substantially all of these costs have been or are expected to be settled in cash.

The following table presents the major components of restructuring and repositioning expenses for the years ended December 31, 2020, 2019,and 2018.

YearEndedDecember31,(Inmillions) 2020 2019 2018Write-off of engineering costs $ 19.7 $ — $ 8.5 Costs related to review of strategic alternatives 7.2 — — Third-party costs of manufacturing and business transformation programs 5.4 7.4 13.7 Employee severance and accelerated stock compensation 4.4 5.8 12.3 Costs related to plant closures 1.8 — 13.4 Other (1.6) 0.5 (1.5)Totalrestructuringandrepositioningexpenses $ 36.9 $ 13.7 $ 46.4

Defined Benefit Pension Expense

Defined benefit pension expense includes costs under U.S. and non-U.S. defined benefit pension plans that provide benefits to businesssegment and corporate employees, as well as retirees and former employees of divested businesses where we retained these obligations.

Under mark-to-market accounting, our pension costs consist of two elements: (1) “certain pension costs”—ongoing costs recognized quarterly,which include service and interest costs, expected returns on plan assets, and amortization of prior service costs/credits; and (2) “pension mark-to-market adjustment and other related costs, net”—mark-to-market gains and losses recognized annually in the fourth quarter, or at an interim periodshould a significant event occur, resulting from changes in actuarial assumptions, such as discount rates and the difference between actual andexpected returns on plan assets.

Certain pension costs were $14.4 million, $18.4 million and $15.9 million for 2020, 2019 and 2018, respectively. The decrease from 2019 to2020 was primarily due to lower interest cost partially offset by higher service cost due to a decrease in discount rates. The increase from 2018 to2019 was primarily due to a decrease in expected return on assets, partially offset by a decrease in service cost and interest cost due to an increasein discount rates.

Pension mark-to-market adjustment and other related costs, net were $94.6 million, $85.9 million and $(15.2) million for 2020, 2019 and 2018,respectively. These costs are reported in “other (income) expense, net” in our Consolidated Financial Statements. The 2020 mark-to-market pensionexpense of $94.6 million was primarily due to the decrease in discount rates used to value the projected benefit obligations of our plans from year-end 2019 to year-end 2020, partially offset by higher than expected return on assets. The 2019 mark-to-market pension expense of $85.9 millionwas primarily due to the decrease in discount rates used to value the projected benefit obligations of our plans from year-end 2018 to year-end2019, partially offset by higher than expected return on assets. The 2018 mark-to-market pension income of $15.2 million was primarily due to theincrease in discount

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rates used to value the projected benefit obligations of our plans from year-end 2017 to year-end 2018, partially offset by lower than expected returnon assets.

Interest and Financing Expenses

Net interest and financing expenses were $74.9 million for 2020, flat compared with 2019 as the effect of a lower interest rate on our term loanwas offset by higher interest from the higher outstanding balances of senior notes and lower capitalized interest. Interest and financing expenseswere $74.8 million for 2019, a 4.7% decrease compared with 2018, primarily due to higher capitalized interest in 2019 related primarily to the growthcapital investments.

Income Taxes

Income tax expense (benefit) for 2020, 2019 and 2018 was $2.2 million, $56.8 million and $78.1 million, respectively, on income before incometaxes of $0.5 million, $183.5 million and $244.9 million in 2020, 2019 and 2018, respectively.

The provision for income taxes in 2020 was lower than in 2019 primarily due to lower pre-tax income in 2020 compared with 2019 and thebenefit recorded in 2020 from the Global Intangible Low-Taxed Income (“GILTI”) high-tax exclusion (“HTE”) election for tax years 2018 through2020. The benefit was partially offset by a valuation allowance recorded against the U.S. federal tax credits.

The provision for income taxes in 2019 was lower than in 2018 primarily due to lower taxable income in foreign jurisdictions where the statutorytax rates are higher than the statutory rates of the U.S., and a deduction against the GILTI inclusion under Internal Revenue Code (“IRC”) Section250 that was not available in 2018 due to U.S. federal net operating loss (“NOL”) carryforwards.

See Note 7 to the Consolidated Financial Statements for additional information regarding income taxes.

FinancialCondition,Liquidity,andCapitalResources

Following is an analysis of our financial condition, liquidity and capital resources at December 31, 2020.

Our principal uses of cash are generally capital investments and acquisitions; working capital investments; compensation paid to employees,including contributions to our defined benefit pension plans and defined contribution plans; the repayment of debt and interest payments thereon;and the return of cash to shareholders through the payment of dividends and the repurchase of shares.

On February 8, 2017, we announced that the Board of Directors had authorized a share repurchase program of up to $250 million. OnFebruary 28, 2020, we announced that our Board of Directors had increased its share repurchase authorization to $250 million, includingapproximately $83 million remaining under the previously announced program. During 2020 we repurchased 673,807 shares of Company commonstock for $40.4 million before temporarily suspending our share repurchase program in early March in light of the COVID-19 pandemic. We expect toresume our share repurchase program in 2021 while continuing to prioritize reinvestment and reducing our temporarily higher net leverage. As ofDecember 31, 2020, $235.0 million remained under the current authorization.

We paid cash dividends of $80.1 million during 2020. On February 4, 2020, we announced that our Board of Directors had approved anincrease in the annual dividend rate, from $1.08 to $1.20 per share of Company common stock, effective with the dividend paid on March 17, 2020.On February 8, 2021, we announced that our Board of Directors had approved a further increase to $1.32 per share of Company common stock,effective with the dividend to be paid on March 23, 2021.

Although the duration and severity of the impact from the COVID-19 pandemic on our operations and liquidity depends on future developmentsthat are difficult to accurately predict at this time, we believe that the cash we expect to generate during 2021 and thereafter, together with otheravailable liquidity and capital resources, are sufficient to finance our operations, growth strategy, expected share repurchase program and expecteddividend payments, and to meet our debt, pension, and legacy and other obligations.

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On June 26, 2020, we issued $750 million aggregate principal amount of 4.875% Notes due in 2027. On July 13, 2020, we used the netproceeds, together with cash on hand, to redeem the $700.0 million Senior Notes due 2021. See Note 5 to the Consolidated Financial Statementsfor additional information.

Cash Resources and Available Credit Facilities

At December 31, 2020, we had available liquidity of $736.5 million, consisting of $304.5 million in cash and cash equivalents ($142.7 million inthe U.S.), $391.8 million available under our revolving credit facility, and $40.2 million of available liquidity under various non-U.S. credit facilities.The $400 million revolving credit facility includes a $100 million sublimit for letters of credit.

Our non-U.S. credit facilities are extended to various subsidiaries that use them primarily to issue bank guarantees supporting trade activityand to provide working capital during occasional cash shortfalls. We generally renew these credit facilities as they expire.

The following table summarizes our non-U.S. credit facilities as of December 31, 2020:

(Inmillions)

MaximumBorrowingAmount

AvailableLiquidity ExpirationDate

China $ 12.1 $ 12.1 April 3, 2023Singapore 18.0 8.2 April 3, 2023Malaysia 7.0 5.3 April 3, 2023Other countries 15.3 14.6 various, as well as open-endedTotal $ 52.4 $ 40.2

Analysis of Cash Flows

The following table summarizes our cash flows for the years ended December 31, 2020, 2019, and 2018:

YearEndedDecember31,(Inmillions) 2020 2019 2018Net cash provided by (used for) operating activities from continuing operations $ 349.6 $ 392.1 $ 342.0 Net cash provided by (used for) investing activities from continuing operations (175.8) (210.1) (618.5)Net cash provided by (used for) financing activities from continuing operations (157.9) (99.4) 316.5 Effect of currency exchange rate changes on cash and cash equivalents 7.4 (0.7) (2.5)Net increase (decrease) in cash and cash equivalents 23.3 81.9 37.5 Cash and cash equivalents, beginning of period 282.9 201.0 163.5 Cash and cash equivalents, end of period $ 306.2 $ 282.9 $ 201.0

Net cash provided by operating activities in 2020 was $349.6 million compared with $392.1 million in the prior year. The year-over-year changein cash flow is primarily due to lower net income partially offset by improved net working capital performance and $20.0 million in dividends receivedfrom our ART joint venture.

Net cash provided by operating activities in 2019 was $392.1 million compared with $342.0 million in the prior year. The year-over-year changein cash flow is primarily due to higher gross profit in 2019 and the $50.0 million accelerated contribution to the U.S. defined benefit pension plans in2018, partially offset by lower advance payments from customers compared with 2018.

Net cash used for investing activities in 2020 was $175.8 million compared with $210.1 million in 2019 and $618.5 million in 2018. Net cashused for investing activities primarily includes the net cash paid for capital expenditures and businesses acquired. Capital expenditures were lower in2020 as we reduced our capital spending in response to lower demand caused by the COVID-19 pandemic. In 2019, we acquired the business andassets of Rive Technology, Inc. for $22.8 million, with an additional $2.0 million holdback paid in the 2020 third quarter. In 2018, we completed thepurchase of the polyolefin catalysts business of Albemarle Corporation for $418.0 million. Our capital expenditures include investments in newcapacity, improved productivity, information technology, and maintenance of our manufacturing and office facilities. We expect to invest

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approximately $150 million to $160 million in capital expenditures in 2021 and have entered into commitments related to a portion of thoseexpenditures. We expect to fund our capital expenditures from net cash provided by operating activities.

Net cash used for financing activities in 2020 was $157.9 million compared with $99.4 million in 2019. The increased use of cash in 2020 wasprimarily due to higher repayments of debt, cash paid for repurchases of common stock, and payments of dividends to shareholders in 2020compared with 2019, together with higher proceeds from the exercise of stock options in 2019.

Net cash used for financing activities in 2019 was $99.4 million compared with cash provided of $316.5 million in 2018. In 2019, higherpayments of dividends to shareholders were offset by higher proceeds from the exercise of stock options, while in 2018 we entered into the 2018Credit Agreement and used a portion of the borrowings to repay in full the borrowings outstanding under our 2014 credit agreement.

Debt and Other Contractual Obligations

Total debt outstanding at December 31, 2020, was $1,990.4 million. Set forth below are our contractual obligations as of December 31, 2020:

PaymentsDuebyPeriod

(Inmillions) Total 1YearorLess2-3Years

4-5Years

MoreThan5Years

Debt $ 1,990.4 $ 15.3 $ 27.9 $ 1,199.6 $ 747.6 Expected interest payments on debt(1) 402.3 78.8 155.4 114.6 53.5 Operating lease obligations 46.6 11.8 13.9 5.6 15.3 Operating commitments(2) 127.6 111.5 14.2 1.9 — Pension funding requirements per ERISA(3) 7.4 0.5 1.1 5.8 — Funding requirements for non-U.S. retirement plans(4) 52.7 10.2 20.6 21.9 — TotalContractualObligations $ 2,627.0 $ 228.1 $ 233.1 $ 1,349.4 $ 816.4 ___________________________________________________________________________________________________________________

(1) Amounts are based on current interest rates as of December 31, 2020, for principal debt outstanding as of December 31, 2020. Actual interestpayments may vary based on any interest rate swaps in effect.

(2) Amounts do not include open purchase commitments, which are routine in nature and normally settle within 90 days, or obligations to employees underannual or long-term incentive programs.

(3) Based on the U.S. qualified pension plans’ status as of December 31, 2020, minimum funding requirements under ERISA have been estimated for thenext five years. Amounts in subsequent years or additional payments have not yet been determined.

(4) Based on the non-U.S. retirement plans’ status as of December 31, 2020, funding requirements have been estimated for the next five years. Amountsin subsequent years have not yet been determined.

The table above does not include liabilities related to legacy matters discussed in Note 10 to the Consolidated Financial Statements, which arerecorded in the Consolidated Balance Sheets. Certain of these liabilities are expected to require cash disbursements over the course of the next fiveyears, but the amount per period depends on a number of variables, as disclosed, while other estimated balances relate to matters for which thesettlement period is unknown.

See Note 10 to the Consolidated Financial Statements for a discussion of Financial Assurances.

Employee Benefit Plans

See Note 8 to the Consolidated Financial Statements for further discussion of Pension Plans and Other Retirement Plans.

Defined Contribution Retirement Plans

We sponsor a defined contribution retirement plan for our employees in the United States. This plan is qualified under section 401(k) of theU.S. tax code. Currently, we contribute an amount equal to 100% of employee contributions, up to 6% of an individual employee’s salary or wages.Our costs related to this benefit

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plan were $14.3 million, $13.9 million and $12.6 million for the years ended December 31, 2020, 2019 and 2018, respectively.

U.S. salaried employees and certain U.S. hourly employees hired on or after January 1, 2017, participate in an enhanced defined contributionplan instead of a defined benefit pension plan. We contribute 4% of an individual employee’s salary or wages to this plan. Our cost related to thisenhanced defined contribution plan was $3.5 million, $2.9 million, and $1.7 million for the years ended December 31, 2020, 2019, and 2018,respectively. We expect these amounts to increase in the future as more employees participate in this plan.

The following table presents cash payments related to our defined contribution plans.

(Inmillions) 2020 2019 2018U.S. defined contribution plan $ 14.3 $ 13.9 $ 12.6 U.S. enhanced defined contribution plan 3.5 2.9 1.7 Totalcashpayments $ 17.8 $ 16.8 $ 14.3

Defined Benefit Pension Plans

We sponsor defined benefit pension plans for our employees in the U.S., Canada, Germany, and a number of other countries, and fundgovernment-sponsored programs in other countries where we operate. Certain of our defined benefit pension plans are advance-funded and othersare pay-as-you-go. The assets of the advance-funded plans are held in trusts. Our most significant advance-funded plans cover current and formersalaried employees in the U.S. and employees covered by collective bargaining agreements at certain of our U.S. facilities. Our U.S. advance-funded plans are qualified under the U.S. tax code.

In the 2021 first quarter, Grace announced to employees that the U.S. salaried plan would be frozen effective January 1, 2025. As a result, weexpect to record mark-to-market income and a curtailment gain totaling approximately $40 million in the 2021 first quarter.

The following table presents the funded status of our fully-funded, underfunded, and unfunded pension plans:

Fully-FundedPensionPlans(1)

UnderfundedPensionPlans(1)

UnfundedPensionPlans(2)

(Inmillions) 2020 2019 2020 2019 2020 2019Projected benefit obligation $ 36.5 $ 35.6 $ 1,109.8 $ 1,022.8 $ 536.4 $ 448.5 Fair value of plan assets 47.9 44.1 981.5 936.7 — — Funded status (PBO basis) $ 11.4 $ 8.5 $ (128.3) $ (86.1) $ (536.4) $ (448.5)___________________________________________________________________________________________________________________

(1) Plans intended to be advance-funded.(2) Plans intended to be pay-as-you-go.

We have both fully-funded and underfunded pension plans. Our fully-funded plans have assets in excess of projected benefit obligation(“PBO”) of $11.4 million at December 31, 2020. Underfunded plans include a group of advance-funded plans that are underfunded on a PBO basisby a total of $128.3 million as of December 31, 2020. Additionally, we have several plans that are funded on a pay-as-you-go basis, and therefore,the entire PBO for these plans of $536.4 million at December 31, 2020, is unfunded. The net funded status of all of these plans was $653.3 millionas of December 31, 2020, and is presented in the Consolidated Balance Sheets as follows: $11.4 million in “other assets,” $15.7 million in “othercurrent liabilities,” $520.7 million in “unfunded defined benefit pension plans,” and $128.3 million in “underfunded defined benefit pension plans.”

At the December 31, 2020, measurement date for the U.S. advance-funded plans, the PBO was $1,112.8 million as measured underU.S. GAAP. The PBO is measured as the present value (using a 2.41% weighted average discount rate as of December 31, 2020) of vested andnon-vested benefits earned from employee service to date, based upon current services and estimated future pay increases for active employees.Of the participants in the U.S. advance-funded plans, approximately 79% are retired or former employees or employees of our former businesses,which shortens the duration of the PBO. Assets available to fund the PBO for the U.S. advance-funded plans at December 31, 2020, were $1,000.7million, or $112.1 million less than the measured obligation.

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The following table presents the components of cash contributions for the advance-funded and pay-as-you-go plans:

(Inmillions) 2020 2019 2018U.S. advance-funded plans $ 0.5 $ 0.1 $ 50.0 U.S. pay-as-you-go plans 7.9 6.6 6.9 Non-U.S. advance-funded plans 1.3 1.5 1.9 Non-U.S. pay-as-you-go plans 7.5 7.6 7.7 TotalCashContributions $ 17.2 $ 15.8 $ 66.5

We intend to fund non-U.S. pension plans based upon applicable legal requirements and actuarial and trustee recommendations. Wecontributed $8.8 million related to these plans in 2020.

Other Contingencies

See Note 10 to the Consolidated Financial Statements for a discussion of our other contingent matters.

Inflation

We recognize that inflationary pressures may have an adverse effect on us through higher asset replacement costs and higher raw materialsand other operating costs. We try to minimize these impacts by developing alternative formulations, increasing productivity, hedging purchases ofcertain raw materials, and increasing prices.

CriticalAccountingEstimates

The preparation of financial statements in conformity with U.S. GAAP requires that we make estimates and assumptions affecting the assetsand liabilities reported at the date of the Consolidated Financial Statements, and the revenues and expenses reported for the periods presented. Webelieve that our accounting estimates are appropriate and the related balances are reasonable; however, actual amounts could differ from theoriginal estimates, requiring adjustments in future periods. Changes in estimates are recorded in the period in which the change is identified. Ouraccounting policies are described in Note 1 to the Consolidated Financial Statements. Critical accounting estimates are described in this section.

An accounting estimate is considered critical if the estimate requires management to make assumptions and judgments about matters thatwere highly uncertain at the time the estimate was made, if different estimates reasonably could have been used, or if changes in the estimate arereasonably likely to occur from period to period that could have a material impact on our financial condition or results of operations. As part of ourquarterly disclosure controls and procedures, management has discussed the development, selection and disclosure of the critical accountingestimates with the Audit Committee of the Board of Directors.

Contingent Liabilities

We have recorded a liability for the resolution of contingencies related to asbestos property damage, environmental remediation, and litigation.We record a liability if we have determined that a loss is probable and we are able to reasonably estimate the amount of the loss or have anotherreasonable basis for recording a liability. We have determined that each of the contingencies identified below involves an accounting judgment thatis material to our Consolidated Financial Statements.

Legacy Product Liabilities

We emerged from an asbestos-related Chapter 11 bankruptcy on February 3, 2014, as discussed in Note 10 to the Consolidated FinancialStatements. Under the plan of reorganization, all pending and future asbestos-related claims are channeled for resolution to either the PI Trust orthe PD Trust. The trusts are the sole recourse for holders of asbestos-related claims. The channeling injunctions issued by the bankruptcy courtprohibit holders of asbestos-related claims from asserting such claims directly against us.

We have satisfied all of our financial obligations to the PI Trust. We have contingent financial obligations remaining to the PD Trust. Withrespect to ZAI PD Claims, the PD Trust was funded with $49.4 million (net of $15 million of attorneys’ fees) to pay claims and expenses. We arealso obligated to make up to 10 contingent

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deferred payments of $8 million per year to the PD Trust during the 20-year period beginning on the fifth anniversary of the Effective Date, with eachsuch payment due only if the assets of the PD Trust in respect of ZAI PD Claims fall below $10 million during the preceding year. For additionaldiscussion of this contingent liability, see Note 10 to the Consolidated Financial Statements, under the heading “Legacy Product Liabilities,” whichdisclosure is incorporated herein by reference.

Environmental Remediation

We are obligated under applicable law to remediate certain properties related to our business or former businesses. At some sites weoutsource all or a portion of the remediation to third parties, and at others we perform the required remediation ourselves. Our environmentalremediation obligation has a significant impact on our Consolidated Financial Statements. See disclosure in this Report in Item 1 (Business—Environment, Health, Safety, and Security Matters) and in Note 10 to the Consolidated Financial Statements for a discussion of our environmentalremediation liabilities.

At sites where third parties conduct remediation, we estimate our obligations from information available to us from these third parties and otherconsultants, including actual costs incurred, expected future costs and time to completion. At sites where we conduct remediation, we work withregulatory authorities to define compliance requirements and then estimate the cost required to meet those requirements with information availableto us. We base our estimates on our historical knowledge and engineering assessments specific to conditions at each site, and we update ourestimates as necessary.

Our estimates can fluctuate significantly due to the extended duration of some remediation projects. The accuracy of our estimates isdependent on the validity of assumptions regarding regulatory approaches and such matters as labor rates, indirect costs and capital costs, whichare each difficult to forecast over extended periods. Future changes in estimates, if required, may lead to material adjustments to our ConsolidatedFinancial Statements, and the ultimate resolution of these obligations could have a material impact on our liquidity and capital resources.

For additional discussion of our liabilities related to environmental matters, see Note 10 to the Consolidated Financial Statements, under theheading “Legacy Environmental Liabilities—Vermiculite-Related Matters,” which disclosure is incorporated herein by reference.

Other Legacy Liabilities

Beginning in 1971, as part of implementing a wet milling process at the Libby, Montana, vermiculite mine, we constructed a dam at the mineproperty that now prevents vermiculite ore tailings from moving into nearby creeks and rivers. Ongoing operation of the dam is regulated by theMontana Department of Natural Resources and Conservation (“DNRC”). In April 2019, the DNRC renewed the permit necessary for operation of thedam. We are legally obligated to operate the dam and construct a new spillway in accordance with the latest permit conditions. We have recorded aliability for the construction of the new spillway based on a current assessment of the project requirements. For additional discussion related to thisliability, see Note 10 to the Consolidated Financial Statements, under the heading “Other Legacy Liabilities,” which disclosure is incorporated hereinby reference.

Litigation

We are subject to legal proceedings and claims arising out of the normal course of business. To estimate the cost to resolve our legalobligations, we review the facts of each matter to determine the merits of the case and the corresponding probability of a loss. If we determine that aloss is probable, we determine if there is sufficient information to make a reasonable estimate of the loss amount. Our estimates regarding theoutcome of our legal proceedings and claims involve substantial uncertainties that could cause our actual losses to differ materially from ourestimates. In estimating the likely outcome of a legal proceeding, we consider the nature of the specific claim (or unasserted claim), our experiencewith similar claims, the jurisdiction in which the proceeding is filed, court rulings, the status of any settlement negotiations, the likelihood of resolutionthrough settlement or alternative dispute resolution, the proceeding’s current status and other relevant information and events. We adjust ourrecorded liability for litigation contingencies as necessary to reflect our current evaluation of these and other factors.

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Goodwill and Intangible Assets

We account for business combinations under the acquisition method of accounting, which requires us to allocate the purchase price to thetangible and identifiable intangible assets and liabilities acquired based on their estimated fair values at the acquisition date in accordance with ASC805 “Business Combinations.” The excess of the purchase price over the fair values of these identifiable assets and liabilities is recorded to goodwill.The assessment of fair value requires management to make significant estimates, including future expected revenues, earnings, and cash flows;expected useful lives; and attrition and discount rates. The allocation of the purchase price may be adjusted during the measurement period, whichmay not exceed one year after the acquisition date.

We review our finite-lived tangible and intangible assets for impairment whenever events or changes in circumstances indicate that thecarrying amount of an asset may not be fully recoverable. We have no indefinite-lived intangible assets. There were no impairment chargesrecorded in any of the periods presented.

We review our goodwill for impairment on an annual basis at October 31 and whenever events or changes in circumstances indicate that thecarrying amount may not be fully recoverable. We have identified our operating segments as reporting units for goodwill impairment testing. OurCatalysts Technologies reportable segment has two reporting units for goodwill impairment testing, which are our Refining Technologies andSpecialty Catalysts operating segments. Our Materials Technologies operating segment represents a single reporting unit for goodwill impairmenttesting.

We performed a qualitative analysis as of October 31, 2020, and concluded that the estimated fair value of all of our reporting unitssubstantially exceeded their carrying values.

Pension Expenses and Liabilities

We sponsor defined benefit pension plans for our employees in the United States and a number of other countries, including Canada andGermany, and fund government-sponsored programs in other countries where we operate. See Note 8 to the Consolidated Financial Statements fora detailed discussion of our pension plans.

In order to estimate our pension expenses and liabilities we evaluate the range of possible assumptions to be used in the calculation of pensionexpenses and liabilities. We select the assumptions that we believe to be most indicative of factors such as participant demographics, pastexperiences and market indices, and provide the assumptions to independent actuaries. These assumptions are updated annually and primarilyinclude factors such as discount rates, expected return on plan assets, mortality rates, retirement rates, and rate of compensation increase. Theindependent actuaries review our assumptions for reasonableness, and use the assumptions to calculate our estimated liability and future pensionexpense. We review the actuarial reports for reasonableness and adjust our expenses, assets and liabilities to reflect the amounts calculated in theactuarial reports.

Our method of accounting for actuarial gains and losses relating to our global defined benefit pension plans is referred to as “mark-to-marketaccounting.” Under mark-to-market accounting, our pension costs consist of two elements: (1) ongoing costs recognized quarterly, which includeservice and interest costs, expected returns on plan assets, and amortization of prior service costs/credits; and (2) mark-to-market gains and lossesrecognized annually in the fourth quarter resulting from changes in actuarial assumptions, such as discount rates and the difference between actualand expected returns on plan assets. Should a significant event occur, our pension obligation and plan assets are remeasured at an interim period,and the gains or losses on remeasurement are recognized in that period.

The two key assumptions used in determining our ongoing quarterly pension expense (excluding the effects of the annual mark-to-marketadjustment) are the discount rate and expected return on plan assets. Our most significant pension assets and pension liabilities relate to U.S.pension plans.

The assumed discount rate for pension plans reflects the market rates for high-quality corporate bonds currently available and is subject tochange based on changes in overall market interest rates. For the U.S. pension plans, the assumed weighted average discount rate was selected inconsultation with our independent actuaries, based on a yield curve constructed from a portfolio of high-quality bonds for which the timing andamount of cash outflows approximate the estimated payouts of the plan.

We selected the expected return on plan assets for the U.S. qualified pension plans for 2020 in consultation with our independent actuaries,using an expected return model. The model determines the weighted average

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return for an investment portfolio based on the target asset allocation and expected future returns for each asset class, which were developed usinga building block approach based on observable inflation, available interest rate information, current market characteristics, and historical results.

The following table reflects the sensitivity of 2021 pre-tax expense (excluding the effects of the annual mark-to-market adjustment) and ouryear-end PBO to a change in the discount rate and expected rate of return on plan assets assumptions for the U.S. pension plans:

ChangeinAssumption(Inmillions)

Effecton2021Pre-TaxPension

ExpenseEffectonDecember31,

2020PBO25 basis point decrease in discount rate $ (1) $ 39 25 basis point increase in discount rate 1 (37)25 basis point decrease in expected return on plan assets 2 — 25 basis point increase in expected return on plan assets (2) —

Income Taxes

Our effective tax rate is primarily determined based on our pre-tax income and the statutory income tax rates in the jurisdictions in which weoperate. The effective tax rate also reflects the tax impacts of items treated differently for tax purposes than for financial reporting purposes. Someof these differences are permanent, such as expenses that are not deductible in our tax returns, and some differences are temporary, reversing overtime, such as depreciation expense. These temporary differences create deferred income tax assets and liabilities. Deferred income tax assets arealso recorded for NOL and federal tax credit carryforwards.

Deferred income tax assets and liabilities are recognized by applying enacted tax rates to temporary differences that exist as of the balancesheet date. We reduce the carrying amounts of deferred tax assets by a valuation allowance if, based on the available evidence, it is more likelythan not that such assets will not be realized. The need to establish valuation allowances for deferred tax assets is assessed quarterly. In assessingthe requirement for, and amount of, a valuation allowance in accordance with the more likely than not standard, we give appropriate consideration toall positive and negative evidence related to the realization of the deferred tax assets. This assessment considers, among other matters, the nature,frequency and severity of current and cumulative losses, forecasts of future profitability and foreign source income (“FSI”), the duration of statutorycarryforward periods, and our experience with operating loss and tax credit carryforward expirations. A history of cumulative losses is a significantpiece of negative evidence used in our assessment. If a history of cumulative losses is incurred for a tax jurisdiction, forecasts of future profitabilityare not used as positive evidence related to the realization of the deferred tax assets in the assessment.

Our net deferred income tax assets (see Note 7 to the Consolidated Financial Statements) as of December 31, 2020, include U.S. deferredincome tax assets representing tax credit and NOL carryforwards of $309.2 million and $10.2 million, respectively, and state and foreign NOLcarryforwards of $45.4 million and $9.6 million. We have established valuation allowances in the amount of $38.7 million, consisting primarily of$11.5 million for U.S. tax credit carryforwards as well as state NOL carryforwards of $13.9 million and foreign deferred tax assets of $13.2 million(primarily related to foreign operating loss carryforwards).

The U.S. tax credit carryforwards arose primarily as a result of the payment of intercompany dividends from our foreign affiliates, from themandatory repatriation under the TCJA, and from research and development credits. The state NOLs arose primarily as a result of the amounts paidas a result of our bankruptcy proceedings.

In order to fully utilize our U.S. federal tax credits before they expire from 2021 to 2040, we will need to generate income of approximately$1.6 billion. We will need to generate approximately $3.1 billion for state income tax purposes during the respective realization periods (ranging from2021 to 2036) in order to fully realize the state NOLs.

Inherent in determining our effective tax rate are judgments regarding business plans and expectations about future operations. Thesejudgments include the amount and geographic mix of future taxable income, the amount of FSI, limitations on the usage of NOLs and foreign taxcredit carryforwards, the impact of ongoing or potential tax audits, and other future tax consequences.

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Our ability to utilize deferred tax assets may be impacted by certain future events, such as changes in tax legislation or insufficient futuretaxable income or FSI prior to expiration of certain deferred tax assets.

We recognize the tax benefits of an uncertain tax position if those benefits are more likely than not to be sustained based on existing tax law.Additionally, we establish a reserve for tax positions that are more likely than not to be sustained based on existing tax law, if the ultimate benefit tobe sustained upon examination by the relevant taxing authorities is uncertain. Unrecognized tax benefits are subsequently recognized at the timethe more likely than not recognition threshold is met, the tax matter is effectively settled or the statute of limitations for the relevant taxing authority toexamine and challenge the tax position has expired, whichever is earlier.

RecentAccountingPronouncements

See Note 1 to the Consolidated Financial Statements for a discussion of recent accounting pronouncements and their effect on us.

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Item7A.QUANTITATIVEANDQUALITATIVEDISCLOSURESABOUTMARKETRISK

Our global operations, raw materials and energy requirements, and debt obligations expose us to various market risks. We use derivativefinancial instruments to mitigate certain of these risks. The following is a discussion of our primary market risk exposures, how those exposures aremanaged, and certain quantitative data pertaining to our market risk-sensitive instruments.

Currency Exchange Rate Risk

We operate and/or sell to customers in over 60 countries and in over 30 currencies; therefore, our results of operations are exposed tochanges in currency exchange rates. We seek to minimize exposure to these changes by matching revenue streams with expenditures in the samecurrencies, but it is not always possible to do so. Further, where revenue streams exceed expenditures in a given currency, we seek opportunities toinvoice our customers in U.S. dollars or peg the revenue stream to the U.S. dollar at the time of the sale. From time to time, we use financialinstruments such as currency forward contracts, swaps, options, or combinations thereof to reduce the risk of certain specific transactions. However,we do not have a policy of hedging all exposures, because management does not believe that such a level of hedging would be cost-effective.Significant uses of derivatives to mitigate the effects of changes in currency exchange rates are as follows.

In May 2016, Grace entered into a fixed-to-fixed cross-currency swap maturing in October 2021 to hedge its net investment in non-U.S.subsidiaries. On every April 1 and October 1, Grace will swap interest payments. Grace will pay euro fixed at the annual rate of 3.426% on €170.0million and receive U.S. dollars fixed at the annual rate of 5.125% on $190.3 million. The agreement requires an exchange of the notional amountsat maturity. The following table presents the aggregate future cash flows for the cross-currency swaps for the next year as of December 31, 2020.

(Inmillions) 2021Payable—interest and principal in euro € 174.4 Receivable—interest and principal in U.S. dollars $ 197.6

The following table presents the fair value of the cross-currency swaps and their location in the Consolidated Balance Sheets.

(Inmillions)December31,

2020Other current liabilities $ (16.9)

In April 2018, in connection with the Credit Agreement (see Note 5), Grace entered into new cross-currency swaps beginning on April 3, 2018,and maturing on March 31, 2023, to synthetically convert $600.0 million of U.S. dollar-denominated floating rate debt into €490.1 million of euro-denominated debt fixed at 2.0231%. These cross-currency swaps were de-designated and terminated on November 5, 2018, and replaced withnew, at-market cross-currency swaps beginning on November 5, 2018, and maturing on March 31, 2023, to synthetically convert $600.0 million ofU.S. dollar-denominated floating rate debt into €525.9 million of euro-denominated debt fixed at 1.785%. The agreements require partial exchangesof the notional amounts each quarter and the remaining amounts at maturity. The following table presents the aggregate future cash flows of thecross-currency swaps for each of the next three years as of December 31, 2020.

(Inmillions) 2021 2022 2023Payable—interest and principal in euro € 14.5 € 14.4 € 505.9 Receivable—interest and principal in U.S. dollars $ 17.9 $ 17.7 $ 577.4

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The following table presents the fair values of the derivative contracts and their location in the Consolidated Balance Sheets.

(Inmillions)December31,

2020Other current liabilities $ (0.2)Other liabilities (50.8)Net fair value $ (51.0)

There were no significant currency forward exchange agreements outstanding at December 31, 2020.

Interest Rate Risk

As of December 31, 2020, approximately $268.9 million of our borrowings were at variable interest rates and expose us to interest rate risk,excluding $586.5 million hedged by cross-currency swaps effective in November 2018, and $100.0 million hedged by interest rate swaps effective inApril 2018. As a result, we have been and will continue to be subject to the fluctuations in interest rates in respect of our floating-rate debt. A 100basis point increase in the interest rates payable on our variable rate debt outstanding as of December 31, 2020, would increase our annual interestexpense by $2.7 million.

In connection with the Credit Agreement (see Note 5), Grace entered into new interest rate swaps beginning on April 3, 2018, and maturing onMarch 31, 2023, fixing the LIBOR component of the interest on $100.0 million of term debt at 2.775%. While we have and may continue to enter intoagreements intending to limit our exposure to higher interest rates, any such agreements may not offer complete protection from this risk.

See Item 8 (Financial Statements and Supplementary Data) under Note 6 (Fair Value Measurements and Risk) to the Consolidated FinancialStatements for additional disclosure around market risk, which disclosure is incorporated herein by reference.

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Item8.FINANCIALSTATEMENTSANDSUPPLEMENTARYDATA

TABLEOFCONTENTS

Management’s Report on Internal Control Over Financial Reporting 59Report of Independent Registered Public Accounting Firm 60Consent of Independent Registered Public Accounting Firm 62Consolidated Statements of Operations 63Consolidated Statements of Comprehensive Income (Loss) 64Consolidated Statements of Cash Flows 65Consolidated Balance Sheets 66Consolidated Statements of Equity 67Notes to Consolidated Financial Statements 68

1.Basis of Presentation and Summary of Significant Accounting and Financial Reporting Policies 682. Inventories 733.Properties and Equipment, and Leases 734.Goodwill and Other Intangible Assets 755.Debt 766. Fair Value Measurements and Risk 797. Income Taxes 858.Pension Plans and Other Retirement Plans 889.Other Balance Sheet Accounts 9510.Commitments and Contingent Liabilities 9611.Restructuring Expenses and Repositioning Expenses 9912.Other (Income) Expense, net 10013.Other Comprehensive Income (Loss) 10114.Shareholders' Equity 10215.Stock Incentive Plans 10316.Earnings Per Share 10617.Revenues 10618.Segment Information 10819.Related Party Transactions 11120.Acquisitions 11321.Quarterly Financial Information (Unaudited) 11422.Subsequent Event 114

Financial Statement Schedule II—Valuation and Qualifying Accounts 115_______________________________________________________________________________

The Financial Statement Schedule should be read in conjunction with the Consolidated Financial Statements and Notes thereto. FinancialStatement Schedules not included have been omitted because they are not applicable or the required information is shown in the ConsolidatedFinancial Statements or Notes thereto. Financial statements of less than majority-owned persons and other persons accounted for by the equitymethod have been omitted as provided in Rule 3-09 of the United States Securities and Exchange Commission’s (the “SEC”) Regulation S-X.

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Management’sReportonInternalControlOverFinancialReporting

Responsibility For Financial Information—We are responsible for the preparation, accuracy, integrity and objectivity of the ConsolidatedFinancial Statements and the other financial information included in this report. Such information has been prepared in conformity with accountingprinciples generally accepted in the United States of America and accordingly, includes certain amounts that represent management’s bestestimates and judgments. Actual amounts could differ from those estimates.

Responsibility For Internal Controls—We and our management are also responsible for establishing and maintaining adequate internalcontrols over financial reporting. These internal controls consist of policies and procedures that are designed to assess and monitor theeffectiveness of the control environment including risk identification, governance structure, delegations of authority, information flow,communications and control activities. A chartered Disclosure Committee oversees Grace’s public financial reporting process and key managers arerequired to confirm their compliance with Grace’s policies and internal controls quarterly. While no system of internal controls can ensure eliminationof all errors and irregularities, Grace’s internal controls, which are reviewed and modified in response to changing conditions, have been designed toprovide reasonable assurance that assets are safeguarded, policies and procedures are followed, transactions are properly executed and reported,and appropriate disclosures are made. The concept of reasonable assurance is based on the recognition that there are limitations in all systems ofinternal control and that the costs of such systems should be balanced with their benefits. The Audit Committee of the Board of Directors, which iscomposed solely of independent directors, meets regularly with Grace’s senior financial management, internal auditors and independent registeredpublic accounting firm to review audit plans and results, as well as the actions taken by management in discharging its responsibilities foraccounting, financial reporting and internal controls. The Audit Committee is responsible for the selection and compensation of the independentregistered public accounting firm. Grace’s financial management, internal auditors and independent registered public accounting firm have directand confidential access to the Audit Committee at all times.

Report On Internal Control Over Financial Reporting—We and our management have evaluated Grace’s internal control over financialreporting as of December 31, 2020. This evaluation was based on criteria for effective internal control over financial reporting set forth in InternalControl—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on thisevaluation, we and our management have concluded that Grace’s internal control over financial reporting is effective as of December 31, 2020.Grace’s independent registered public accounting firm that audited our financial statements included in Item 8 has also audited the effectiveness ofGrace’s internal control over financial reporting as of December 31, 2020, as stated in their report, which appears on the following page.

Report On Disclosure Controls And Procedures—As of December 31, 2020, we and our management carried out an evaluation of theeffectiveness of the design and operation of Grace’s disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Actof 1934, as amended (the “Exchange Act”). Based upon that evaluation, we concluded that Grace’s disclosure controls and procedures are effectivein ensuring that information required to be disclosed in Grace’s periodic filings and submissions under the Exchange Act is accumulated andcommunicated to us and our management to allow timely decisions regarding required disclosures, and such information is recorded, processed,summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.

/s/ HUDSON LA FORCE /s/ WILLIAM C. DOCKMANHudson La ForcePresident and Chief Executive Officer(Principal Executive Officer)

William C. Dockman Senior Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

Date: February 25, 2021

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ReportofIndependentRegisteredPublicAccountingFirm

To the Board of Directors and Shareholders of W. R. Grace & Co.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of W. R. Grace & Co. and its subsidiaries (the “Company”) as of December 31,2020 and 2019, and the related consolidated statements of operations, of comprehensive income (loss), of equity and of cash flows for each of thethree years in the period ended December 31, 2020, including the related notes and financial statement schedule listed in the accompanying indexfor each of the three years in the period ended December 31, 2020 (collectively referred to as the “consolidated financial statements”). We also haveaudited the Company's internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control -Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Companyas of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended December31, 2020 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained,in all material respects, effective internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control -Integrated Framework (2013) issued by the COSO.

Change in Accounting Principle

As discussed in Note 1 to the consolidated financial statements, the Company changed the manner in which it accounts for leases in 2019.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financialreporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Reporton Internal Control Over Financial Reporting. Our responsibility is to express opinions on the Company’s consolidated financial statements and onthe Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public CompanyAccounting Oversight Board (United States) (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 audits to obtainreasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, andwhether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidatedfinancial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, ona test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating theaccounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidatedfinancial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financialreporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal controlbased on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. Webelieve that our audits provide a reasonable basis for our opinions.

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 financialreporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Acompany’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, inreasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance thattransactions 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

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being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regardingprevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on thefinancial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of anyevaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or thatthe degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that wascommunicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to theconsolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical auditmatters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating thecritical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Environmental Liability for the Libby Mine and Surrounding Area

As described in Note 10 to the consolidated financial statements, the Company is engaged with the U.S. Environmental Protection Agency (the“EPA”) and other federal, state and local governmental agencies in a remedial investigation and feasibility study (“RI/FS”) of the Libby mine and thesurrounding area, known as Operable Unit 3 (“OU3”). The RI/FS will study the areas within OU3 requiring remediation and will identify possibleremedial action alternatives. Possible remedial actions within OU3 are wide-ranging, from institutional controls such as land use restrictions, to moreactive measures involving soil removal, containment projects, or other protective measures. As part of the RI/FS process, management contractedan engineering and consulting firm to develop a range of possible remedial alternatives and associated cost estimates for OU3. The estimated costsof remediation are preliminary and consist of several components, each of which may vary significantly as the remedial alternatives are furtherdeveloped. It is reasonably possible that the ultimate costs of remediation could range between $30 million and $170 million. The ultimate remedywill be determined by the EPA after the RI/FS is finalized. Such remedy will be set forth in a Record of Decision (“ROD”) that is currently expected tobe issued by the EPA no earlier than 2024. Depending on the remedial alternatives that the EPA selects in the ROD, the total cost of remediatingOU3 may exceed management’s current estimate by material amounts. The Company’s estimated liability for response costs that are currentlyestimable for OU3 and vermiculite processing sites outside of Libby at December 31, 2020 totaled $71.2 million.

The principal considerations for our determination that performing procedures relating to the environmental liability for the Libby mine andsurrounding area is a critical audit matter are (i) the significant judgment by management when developing the environmental liability for the Libbymine and the surrounding area, which in turn led to a high degree of auditor judgment and subjectivity in performing procedures and evaluating auditevidence related to management’s estimated remedial alternatives and the related estimated costs of such remedial alternatives, and (ii) the auditeffort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on theconsolidated financial statements. These procedures included testing the effectiveness of controls relating to management’s estimates of theenvironmental liability for the Libby mine and surrounding area, including controls over the on-going monitoring of information that may impact theremedial alternatives and the associated costs. These procedures also included, among others, assessing the completeness, accuracy andrelevance of the information used by management, and evaluating the remedial alternatives selected by management and the associated costs.Professionals with specialized skill and knowledge were used to assist in assessing the information used by management, and evaluating theremedial alternatives selected by management and the associated costs.

/s/ PricewaterhouseCoopers LLPBaltimore, MarylandFebruary 25, 2021

We have served as the Company’s auditor since 1906.

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ConsentofIndependentRegisteredPublicAccountingFirm

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-224767, 333-194171) of W. R. Grace &Co. of our report dated February 25, 2021 relating to the financial statements and financial statement schedule and the effectiveness of internalcontrol over financial reporting, which appears in this Form 10-K.


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W.R.Grace&Co.andSubsidiariesConsolidatedStatementsofOperations

YearEndedDecember31,(Inmillions,exceptpershareamounts) 2020 2019 2018Net sales $ 1,729.8 $ 1,958.1 $ 1,932.1 Cost of goods sold 1,113.3 1,164.4 1,165.4 Gross profit 616.5 793.7 766.7 Selling, general and administrative expenses 282.9 299.0 300.4 Research and development expenses 65.9 64.5 62.7 Costs related to legacy matters 39.4 103.5 82.3 Restructuring and repositioning expenses 36.9 13.7 46.4 Equity in earnings of unconsolidated affiliate (13.5) (27.8) (31.8)Loss on early extinguishment of debt 39.4 — 4.8 Interest expense and related financing costs 76.0 76.7 80.2 Other (income) expense, net 89.0 80.6 (23.2)Total costs and expenses 616.0 610.2 521.8 Income (loss) before income taxes 0.5 183.5 244.9 (Provision for) benefit from income taxes (2.2) (56.8) (78.1)Net income (loss) (1.7) 126.7 166.8 Less: Net (income) loss attributable to noncontrolling interests (0.1) (0.4) 0.8 Netincome(loss)attributabletoW.R.Grace&Co.shareholders $ (1.8) $ 126.3 $ 167.6 EarningsPerShareAttributabletoW.R.Grace&Co.ShareholdersBasicearningspershare:

Net income (loss) $ (0.03) $ 1.89 $ 2.49 Weighted average number of basic shares 66.3 66.8 67.2

Dilutedearningspershare:Net income (loss) $ (0.03) $ 1.89 $ 2.49 Weighted average number of diluted shares 66.3 66.9 67.3

Dividendspercommonshare $ 1.20 $ 1.08 $ 0.96

The Notes to Consolidated Financial Statements are an integral part of these statements.

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W.R.Grace&Co.andSubsidiariesConsolidatedStatementsofComprehensiveIncome(Loss)

YearEndedDecember31,(Inmillions) 2020 2019 2018Netincome(loss) $ (1.7) $ 126.7 $ 166.8 Othercomprehensiveincome(loss),netofincometaxes:

Defined benefit pension and other postretirement plans (0.4) (0.7) (0.9)Currency translation adjustments (49.9) 16.5 32.4 Gain (loss) from hedging activities 0.8 (4.9) (5.7)

Totalothercomprehensiveincome(loss),netofincometaxes (49.5) 10.9 25.8 Comprehensiveincome(loss) (51.2) 137.6 192.6

Less: comprehensive (income) loss attributable to noncontrolling interests (0.1) (0.4) 0.8 Comprehensiveincome(loss)attributabletoW.R.Grace&Co.shareholders $ (51.3) $ 137.2 $ 193.4


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W.R.Grace&Co.andSubsidiariesConsolidatedStatementsofCashFlows

YearEndedDecember31,(Inmillions) 2020 2019 2018OPERATINGACTIVITIES Net income (loss) $ (1.7) $ 126.7 $ 166.8 Reconciliationtonetcashprovidedby(usedfor)operatingactivities: Depreciation and amortization 105.0 100.3 100.8 Equity in earnings of unconsolidated affiliate (13.5) (27.8) (31.8)Dividends received from unconsolidated affiliate 20.0 — — Costs related to legacy product, environmental, and other claims 39.4 103.5 82.3 Cash paid for legacy product, environmental, and other claims (21.0) (19.3) (22.9)Provision for (benefit from) income taxes 2.2 56.8 78.1 Cash paid for income taxes (56.0) (52.8) (54.0)Income tax refunds received 9.6 10.5 0.7 Defined benefit pension expense (income) 109.0 104.3 0.7 Cash paid under defined benefit pension arrangements (17.2) (15.8) (66.5)Stock compensation expense 10.7 14.6 18.6 Loss on early extinguishment of debt 39.4 — 4.8 Loss on disposal of assets 23.2 4.2 13.2 Changesinassetsandliabilities,excludingeffectofcurrencytranslationandacquisitions: Trade accounts receivable 59.7 (18.7) 2.5 Inventories 62.0 (30.1) (26.1)Accounts payable (9.3) 28.0 24.2 Deferred revenue (7.4) (5.3) 35.6 All other items, net (4.5) 13.0 15.0

Netcashprovidedby(usedfor)operatingactivities 349.6 392.1 342.0 INVESTINGACTIVITIES Capital expenditures (155.5) (194.1) (216.3)Business acquired, net of cash acquired (2.0) (22.8) (418.0)Other investing activities (18.3) 6.8 15.8

Netcashprovidedby(usedfor)investingactivities (175.8) (210.1) (618.5)FINANCINGACTIVITIES Borrowings under credit arrangements 15.9 13.0 1,024.0 Repayments under credit arrangements (49.9) (24.2) (587.8)Proceeds from issuance of notes 750.0 — — Repayment of notes (700.0) — — Cash paid related to early extinguishment of debt (37.9) — — Cash paid for debt financing costs (7.9) — (11.8)Cash paid for repurchases of common stock (40.4) (29.8) (80.0)Proceeds from exercise of stock options — 19.1 6.7 Dividends paid to shareholders (80.1) (72.6) (64.6)Cash received from hedge settlement — — 33.1 Other financing activities (7.6) (4.9) (3.1)

Netcashprovidedby(usedfor)financingactivities (157.9) (99.4) 316.5 Effect of currency exchange rate changes on cash and cash equivalents 7.4 (0.7) (2.5)

Netincrease(decrease)incash,cashequivalents,andrestrictedcash 23.3 81.9 37.5 Cash, cash equivalents, and restricted cash, beginning of period 282.9 201.0 163.5 Cash, cash equivalents, and restricted cash, end of period $ 306.2 $ 282.9 $ 201.0

SupplementaldisclosureofcashflowinformationCash paid for interest, net of amounts capitalized $ 74.2 $ 67.7 $ 75.2 Capital expenditures included in accounts payable 51.9 49.8 31.0 Expenditures for other investing activities included in accounts payable 0.4 16.2 16.9 Net share settled stock option exercises — 9.7 8.2


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W.R.Grace&Co.andSubsidiariesConsolidatedBalanceSheets

December31,(Inmillions,exceptparvalueandshares) 2020 2019ASSETS CurrentAssets Cash and cash equivalents $ 304.5 $ 282.5 Restricted cash and cash equivalents 1.7 0.4 Trade accounts receivable, less allowance of $2.2 (2019—$13.3) 264.1 307.0 Inventories 253.8 309.9 Other current assets 51.2 235.1

TotalCurrentAssets 875.3 1,134.9 Properties and equipment, net of accumulated depreciation and amortization of $1,550.1 (2019—$1,497.0) 1,208.8 1,143.8 Goodwill 562.7 556.9 Technology and other intangible assets, net 320.8 342.8 Deferred income taxes 567.1 517.6 Investment in unconsolidated affiliate 175.5 181.9 Other assets 55.3 54.7

TotalAssets $ 3,765.5 $ 3,932.6 LIABILITIESANDEQUITY CurrentLiabilities Debt payable within one year $ 15.3 $ 23.1 Accounts payable 262.1 302.3 Other current liabilities 281.9 419.7

TotalCurrentLiabilities 559.3 745.1 Debt payable after one year 1,975.1 1,957.3 Unfunded defined benefit pension plans 520.7 434.6 Underfunded defined benefit pension plans 128.3 85.2 Other liabilities 347.6 308.2

TotalLiabilities 3,531.0 3,530.4 CommitmentsandContingencies—Note10Equity Common stock issued, par value $0.01; 300,000,000 shares authorized; outstanding: 66,190,410 (2019—66,735,913) 0.7 0.7 Paid-in capital 473.2 477.9 Retained earnings 648.8 730.5 Treasury stock, at cost: shares: 11,266,223 (2019—10,720,720) (920.6) (892.2)Accumulated other comprehensive income (loss) 29.3 78.8

TotalW.R.Grace&Co.Shareholders’Equity 231.4 395.7 Noncontrolling interests 3.1 6.5

TotalEquity 234.5 402.2 TotalLiabilitiesandEquity $ 3,765.5 $ 3,932.6


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W.R.Grace&Co.andSubsidiariesConsolidatedStatementsofEquity

(Inmillions)

CommonStockandPaid-inCapital

RetainedEarnings

TreasuryStock

AccumulatedOther

Comprehensive(Loss)Income

NoncontrollingInterests

TotalEquity

Balance,December31,2017 $ 475.5 $ 573.1 $ (832.1) $ 39.9 $ 6.9 $ 263.3 Net income (loss) — 167.6 — — (0.8) 166.8 Repurchase of common stock — — (80.0) — — (80.0)Stock-based compensation 18.6 — — — — 18.6 Exercise of stock options (4.2) — 10.6 — — 6.4 Payments in consideration of employee tax

obligations related to stock-basedcompensation (2.9) — — — — (2.9)

Shares issued (5.2) — 6.0 — — 0.8 Dividends declared — (64.3) — — — (64.3)Other comprehensive income (loss) — — — 25.8 — 25.8 Effect of adopting ASC 606 — 2.5 — — — 2.5 Effect of adopting ASU 2018-02 — (2.2) — 2.2 — — Balance,December31,2018 481.8 676.7 (895.5) 67.9 6.1 337.0 Net income (loss) — 126.3 — — 0.4 126.7 Repurchase of common stock — — (29.8) — — (29.8)Stock-based compensation 14.6 — — — — 14.6 Exercise of stock options (5.0) — 24.1 — — 19.1 Payments in consideration of employee tax


Shares issued (7.9) — 9.0 — — 1.1 Dividends declared — (72.5) — — — (72.5)Other comprehensive income (loss) — — — 10.9 — 10.9 Balance,December31,2019 478.6 730.5 (892.2) 78.8 6.5 402.2 Net income (loss) — (1.8) — — 0.1 (1.7)Repurchase of common stock — — (40.4) — — (40.4)Stock-based compensation 10.5 — — — — 10.5 Payments in consideration of employee tax


Shares issued (11.2) — 12.0 — — 0.8 Dividends declared — (79.9) — — — (79.9)Distribution to joint venture partner — — — — (3.5) (3.5)Other comprehensive income (loss) — — — (49.5) — (49.5)Balance,December31,2020 $ 473.9 $ 648.8 $ (920.6) $ 29.3 $ 3.1 $ 234.5


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W.R.Grace&Co.andSubsidiariesNotestoConsolidatedFinancialStatements

1.BasisofPresentationandSummaryofSignificantAccountingandFinancialReportingPolicies

W. R. Grace & Co., through its subsidiaries, is engaged in the production and sale of specialty chemicals and specialty materials on a globalbasis through two reportable segments: Grace Catalysts Technologies, which includes catalysts and related products and technologies used inpetrochemical, refining, and other chemical manufacturing applications; and Grace Materials Technologies, which includes specialty materials,including silica-based and silica-alumina-based materials, used in pharma/consumer, coatings, and chemical process applications.

W. R. Grace & Co. conducts all of its business through a single wholly owned subsidiary, W. R. Grace & Co.–Conn. (“Grace–Conn.”). Grace–Conn. owns all of the assets, properties and rights of W. R. Grace & Co. on a consolidated basis, either directly or through subsidiaries.

As used in these notes, the term “Company” refers to W. R. Grace & Co. The term “Grace” refers to the Company and/or one or more of itssubsidiaries and, in certain cases, their respective predecessors.

Principles of Consolidation The Consolidated Financial Statements include the accounts of Grace and entities as to which Grace maintainsa controlling financial interest. Intercompany transactions and balances are eliminated in consolidation. Investments in affiliated companies in whichGrace can significantly influence operating and financial policies, but does not have a controlling financial interest, are accounted for under theequity method.

Grace conducts a portion of its business through joint ventures with unaffiliated third parties. For joint ventures in which Grace has a controllingfinancial interest, Grace consolidates the results of such joint ventures in the Consolidated Financial Statements. Grace recognizes a liability forcumulative amounts due to the third parties based on the financial results of the joint ventures, and deducts the amount of income attributable tononcontrolling interests in the measurement of its consolidated net income.

Reportable Segments Grace reports financial results of each of its reportable segments that engage in business activities that generaterevenues and expenses and whose operating results are regularly reviewed by Grace’s Chief Executive Officer.

Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”)requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingentassets and liabilities at the date of the Consolidated Financial Statements, and the reported amounts of revenues and expenses for the periodspresented. Actual amounts could differ from those estimates, and the differences could be material. Changes in estimates are recorded in the periodidentified. Grace’s accounting measurements that are most affected by management’s estimates of future events are:

• The effective tax rate and realization values of net deferred tax assets, which depend on projections of future taxable income (see Note7);

• Pension and postretirement liabilities, which depend on assumptions regarding participant life spans, future inflation, discount rates andtotal returns on invested funds (see Note 8);

• Carrying values of goodwill and other intangible assets, which depend on assumptions of future earnings and cash flows (see Note 4and Note 20); and

• Contingent liabilities, which depend on an assessment of the probability of loss and an estimate of ultimate obligation, such as litigationand arbitration; and product, environmental, and other legacy liabilities (see Note 10).

Revenue Recognition Grace generates revenues predominantly from sales of manufactured products to customers and in part fromlicensing of technology. Under ASC 606, revenue from customer arrangements is recognized when control is transferred to the customer.

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NotestoConsolidatedFinancialStatements(Continued)

1.BasisofPresentationandSummaryofSignificantAccountingandFinancialReportingPolicies(Continued)

Product Sales

Based on the promises made to customers in product sales arrangements, Grace has a performance obligation to manufacture and deliverproducts to its customers. Grace makes certain other promises in its customer arrangements that are immaterial in the context of the contracts.Revenue is recognized at amounts based on agreed-upon prices in sales contracts and/or purchase orders. Grace offers various incentives to itsproduct sales customers that result in variable consideration, including but not limited to volume discounts, which reward bulk purchases by loweringthe price for future purchases, and volume rebates, which encourage customers to purchase volume levels that would reduce their current prices.These incentives are immaterial in the context of the contracts.

For product sales, control is transferred at the point in time at which risk of loss and title have transferred to the customer, which is determinedbased on shipping terms and contract terms, respectively. Terms of delivery and terms of payment are generally included in customer contracts ofsale, order confirmation documents, and invoices. Payment is generally due within 30 to 60 days of invoicing. Grace defers revenue recognition untilno other significant Grace performance obligations remain. Grace’s customer arrangements do not contain significant acceptance provisions.

Taxes that Grace collects that are assessed by a governmental authority, and that are both imposed on and concurrent with any of its revenue-producing activities, are excluded from revenue. Grace considers shipping and handling activities that it performs as activities to fulfill the sales of itsproducts. Amounts billed for shipping and handling are included in “net sales,” while costs incurred for shipping and handling are included in “cost ofgoods sold.”

Technology Licensing

For Grace’s technology licensing business, customer arrangements typically contain multiple deliverables to enable licensees to realize the fullbenefit of the technology. These deliverables include licensing the technology itself; developing engineering design packages; and providing training,consulting, and technical services. Under these arrangements, the license grant is not a distinct performance obligation, as the licensee only canbenefit from the license in conjunction with other integral services such as development of the engineering design package, training, consulting, ortechnical services provided over the contract period. Therefore, Grace accounts for the license grant and integral services as a single performanceobligation. Certain deliverables and services not included in the core bundled deliverables are accounted for as separate performance obligations.

The transaction price is specified in the technology licensing agreements and is substantially fixed. Some services are priced on a per-diembasis, but these are not material in the context of the contracts. Grace invoices its technology licensing customers as certain project milestones areachieved. Payment terms are similar to those of Grace’s product sales.

Revenue for each performance obligation is recognized when control is transferred to the customer, which is typically over a period of time. Asa result, Grace generally recognizes revenue for each performance obligation ratably over the period of the contract, which is up to eight years,depending on the scope of the licensee’s project. Based on the timing of payments, Grace records deferred revenue related to these agreements.See Note 17.

Cash Equivalents Cash equivalents consist of liquid instruments and investments with maturities of three months or less when purchased.The recorded amounts approximate fair value.

Inventories Inventories are stated at the lower of cost or net realizable value. The method used to determine cost is first-in/first-out, or“FIFO.” Market values for raw materials are based on current cost and, for other inventory classifications, net realizable value. Inventories areevaluated regularly for salability, and slow moving and/or obsolete items are adjusted to expected salable value. Inventory values include direct andcertain indirect costs of materials and production. Abnormal costs of production are expensed as incurred.

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Long Lived Assets Properties and equipment are stated at cost. Depreciation of properties and equipment is generally computed using thestraight-line method over the estimated useful life of the asset. Estimated useful lives range from 20 to 30 years for buildings, 3 to 7 years forinformation technology equipment, 5 to 25 years for operating machinery and equipment, and 5 to 10 years for furniture and fixtures. Interest iscapitalized in connection with major project expenditures. Fully depreciated assets are retained in properties and equipment and relatedaccumulated depreciation accounts until they are removed from service. In the case of disposals, assets and related accumulated depreciation areremoved from the accounts and the net amount, less any proceeds from disposal, is charged or credited to earnings. Obligations for costsassociated with asset retirements, such as requirements to restore a site to its original condition, are accrued at net present value and amortizedalong with the related asset.

Intangible assets with finite lives consist of technology, customer lists, trademarks, and other intangibles and are amortized over their estimateduseful lives, ranging from 1 to 30 years.

Grace reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an assetmay not be fully recoverable. There were no impairment charges recorded in any of the periods presented.

Leases Grace leases certain real estate, office space, vehicles, railcars, and plant and office equipment, substantially all of which areaccounted for as operating leases. Finance lease costs and sublease income are not material. Many of Grace’s leases contain renewal options,which are exercisable at Grace’s discretion and may be included in lease terms when they are reasonably certain to be exercised. Grace’s leaseagreements do not contain material restrictive covenants or material residual value guarantees. Grace has elected not to recognize in theConsolidated Balance Sheets short-term leases, which are those with an initial term of 12 months or less. Grace has also elected not to separatelease and non-lease components. These elections apply to all asset classes. Where available, Grace uses the interest rate implicit in the lease tocalculate the estimated present value of lease payment obligations. Where such a rate is not available, Grace uses an incremental borrowing ratebased on credit-adjusted and term-specific discount rates, using a third-party yield curve.

Goodwill Goodwill arises from business combinations, and it is reviewed for impairment on an annual basis at October 31 and wheneverevents or changes in circumstances indicate that the carrying amount may not be fully recoverable. Recoverability is assessed at the reporting unitlevel most directly associated with the business combination that generated the goodwill. For the purpose of measuring impairment, Grace hasidentified its operating segments as reporting units. Grace has evaluated its goodwill annually with no impairment charge required in any of theperiods presented.

Financial Instruments Grace uses commodity forward, swap and/or option contracts; currency forward, swap, and/or option contracts; andinterest rate swap contracts to manage exposure to fluctuations in commodity prices, currency exchange rates, and interest rates. Grace does nothold or issue derivative financial instruments for trading purposes. Derivative instruments are recorded at fair value in the Consolidated BalanceSheets as either assets or liabilities. For derivative instruments designated as fair value hedges, changes in the fair values of the derivativeinstruments closely offset changes in the fair values of the hedged items in “other (income) expense, net” in the Consolidated Statements ofOperations. For derivative instruments designated as cash flow hedges, the gain or loss on the hedge is reported in “accumulated othercomprehensive income (loss)” in the Consolidated Balance Sheets until it is cleared to earnings during the same period in which the hedged itemaffects earnings. Forward points are excluded from the assessment of effectiveness and are amortized to income on a systematic basis. Forderivative instruments designated as net investment hedges, the gains and losses on the hedge, adjusted for the impact of excluded components,are recorded net of tax to “currency translation adjustments” within “accumulated other comprehensive income (loss)” to offset the change in thecarrying value of the net investment being hedged. Changes in the fair value of the hedging instrument related to time value, which are excludedfrom the assessment of hedge effectiveness, are recorded directly to interest expense on a systematic basis. The changes in the fair values ofderivative instruments that are not designated as hedges are recorded in current period earnings. Cash flows from derivative instruments arereported in the same category as the cash flows from the items being hedged.

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Income Taxes Deferred tax assets and liabilities are recognized with respect to the expected future tax consequences of events that havebeen recorded in the Consolidated Financial Statements. Grace reduces the carrying amounts of deferred tax assets by a valuation allowance if,based on the available evidence, it is more likely than not that such assets will not be realized. The need to establish valuation allowances fordeferred tax assets is assessed quarterly.

In assessing the requirement for, and amount of, a valuation allowance in accordance with the more likely than not standard, Grace givesappropriate consideration to all positive and negative evidence related to the realization of the deferred tax assets. This assessment considers,among other matters, the nature, frequency, and severity of current and cumulative losses; forecasts of future profitability; domestic and foreignsource income; the duration of statutory carryforward periods; and Grace’s experience with operating loss and tax credit carryforward expirations.

Tax benefits from an uncertain tax position are recognized only if it is more likely than not that the tax position will be sustained uponexamination by the taxing authorities based on the technical merits of the position. Tax benefits recognized in the Consolidated FinancialStatements from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized uponultimate settlement. Grace evaluates such likelihood based on relevant facts and tax law. Grace adjusts its recorded liability for income tax mattersdue to changes in circumstances or new uncertainties, such as amendments to existing tax law. Grace’s ultimate tax liability depends upon manyfactors, including negotiations with taxing authorities in the jurisdictions in which it operates, outcomes of tax litigation, and resolution of disputesarising from federal, state, and foreign tax audits. Due to the varying tax laws in each jurisdiction management, with the assistance of local taxadvisors as necessary, assesses individual matters in each jurisdiction on a case-by-case basis. Grace researches and evaluates its income taxpositions, including why it believes they are compliant with income tax regulations, and these positions are documented as appropriate.

The U.S. Tax Cuts and Jobs Act of 2017 (“TCJA”) subjects a U.S. entity to tax on global intangible low-taxed income (“GILTI”) earned bycertain foreign subsidiaries. An entity can make an accounting policy election to either recognize deferred taxes for temporary basis differencesexpected to reverse as GILTI in future years or to provide for the tax expense related to GILTI in the year the tax is incurred as a period expenseonly. Grace has elected to account for GILTI as a period expense in the year the tax is incurred. Grace has also adopted the tax law orderingapproach for evaluating the impact of GILTI on the assessment of the realizability of US deferred tax assets.

Pension Benefits Grace’s method of accounting for actuarial gains and losses relating to its global defined benefit pension plans is referredto as “mark-to-market accounting.” Under mark-to-market accounting, Grace’s pension costs consist of two elements: (1) ongoing costs recognizedquarterly, which include service and interest costs, expected returns on plan assets, and amortization of prior service costs/credits; and (2) mark-to-market gains and losses recognized annually in the fourth quarter resulting from changes in actuarial assumptions, such as discount rates and thedifference between actual and expected returns on plan assets. Should a significant event occur, Grace’s pension obligation and plan assets areremeasured at an interim period, and the gains or losses on remeasurement are recognized in that period.

Stock-Based Compensation The Company recognizes expenses related to stock-based compensation payment transactions in which itreceives employee services in exchange for (a) equity instruments of the Company or (b) liabilities that are based on the fair value of the Company’sequity instruments or that may be settled by the issuance of equity instruments. Stock-based compensation cost for restricted stock units (“RSUs”)and share settled performance-based units (“PBUs”) are measured based on the high/low average of the Company’s common stock on the date ofgrant. Cash-settled RSUs are remeasured at the end of each reporting period based on the closing fair market value of the Company’s commonstock. Stock-based compensation cost for stock options is estimated at the grant date based on each option’s fair value as calculated by the Black-Scholes option pricing model. The Company recognizes stock-based compensation cost as expense ratably on a straight-line basis over therequisite service period.

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Currency Translation Assets and liabilities of foreign subsidiaries (other than those located in countries with highly inflationary economies)are translated into U.S. dollars at current exchange rates, while revenues, costs and expenses are translated at average exchange rates duringeach reporting period. The resulting translation adjustments are included in “accumulated other comprehensive income (loss)” in the ConsolidatedBalance Sheets. The financial statements of any subsidiaries located in countries with highly inflationary economies are remeasured as if thefunctional currency were the U.S. dollar; the remeasurement creates translation adjustments that are reflected in net income in the ConsolidatedStatements of Operations.

Reclassifications Certain amounts in prior years’ Consolidated Financial Statements have been reclassified to conform to the current yearpresentation. Such reclassifications have not materially affected previously reported amounts in the Consolidated Financial Statements.

Recently Issued Accounting Standards In December 2019, the FASB issued ASU 2019-12 “Income Taxes (Topic 740): Simplifying theAccounting for Income Taxes.” This update clarifies and amends existing guidance, including removing certain exceptions to the general principlesin Topic 740 and improves consistent application of and simplifies U.S. GAAP for other areas of Topic 740. Grace will adopt this update on January1, 2021, when it becomes effective.

Recently Adopted Accounting Standards In March 2020, the FASB issued ASU 2020-04 “Reference Rate Reform (Topic 848): Facilitationof the Effects of Reference Rate Reform on Financial Reporting.” This update is intended to ease the potential burden in accounting for andrecognizing the effects of reference rate reform. It provides optional practical expedients and exceptions for applying U.S. GAAP to contracts,hedging relationships, and other transactions affected by reference rate reform, if certain criteria are met. This update became effective on March12, 2020, and is available for use through December 31, 2022. Grace expects to utilize the practical expedients provided by this update inaccounting for contract modifications and/or hedging transactions during the effective period. Grace expects the update to significantly reduce theeffects of reference rate reform on the Consolidated Financial Statements.

In August 2018, the FASB issued ASU 2018-14 “Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20).”This update revises disclosure requirements related to defined benefit pension and other postretirement plans. Grace adopted this update in the2020 first quarter, and it did not have a material effect on the Consolidated Financial Statements.

In June 2016, the FASB issued ASU 2016-13 “Financial Instruments—Credit Losses (Topic 326) Measurement of Credit Losses on FinancialInstruments.” This update requires companies to implement an impairment model based on expected credit losses, rather than probable incurredlosses. Grace adopted this update in the 2020 first quarter, and it did not have a material effect on the Consolidated Financial Statements.

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2.Inventories

Inventories are stated at the lower of cost or net realizable value, and cost is determined using FIFO. Inventories consisted of the following atDecember 31, 2020 and 2019:

December31,(Inmillions) 2020 2019Raw materials $ 57.0 $ 64.2 In process 38.2 55.7 Finished products 126.6 154.4 Other 32.0 35.6

$ 253.8 $ 309.9

During the three months ended June 30, 2020, Grace implemented changes to its Refining Technologies manufacturing operations to improvecapital and operating efficiencies. This included key organizational changes and optimization of plant and manufacturing processes at Grace’s threehydroprocessing catalyst manufacturing sites. As a result of these changes, Grace recorded a pre-tax charge of $19.7 million related to a write-off ofinventory now deemed obsolete based on the process changes.

3.PropertiesandEquipment,andLeases

December31,(Inmillions) 2020 2019Land $ 26.5 $ 29.5 Buildings 476.6 438.9 Information technology and equipment 124.1 131.3 Machinery, equipment and other 1,956.0 1,754.5 Projects under construction 175.7 286.6 Properties and equipment, gross 2,758.9 2,640.8 Accumulated depreciation and amortization (1,550.1) (1,497.0)Propertiesandequipment,net $ 1,208.8 $ 1,143.8

Capitalized interest costs amounted to $7.0 million, $7.5 million, and $3.2 million in 2020, 2019, and 2018, respectively. Depreciation andfinance lease amortization expense relating to properties and equipment was $82.9 million, $78.4 million, and $80.9 million in 2020, 2019, and 2018,respectively.

The following table presents Grace’s lease right-of-use assets, net of accumulated amortization, and operating lease liabilities as of December31, 2020 and 2019.

December31,(inmillions) 2020 2019 BalanceSheetLocationOperating lease right of use asset $ 35.1 $ 34.9 Other assetsOperating lease liability—current 10.1 9.3 Other current liabilitiesOperating lease liability—noncurrent 25.8 26.2 Other liabilities

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3.PropertiesandEquipment,andLeases(Continued)

The following table presents Grace’s costs and cash flow information related to operating leases for the year ended December 31, 2020.

YearEndedDecember31,(Inmillions) 2020 2019Operating lease cost $ 13.3 $ 12.1 Short-term and variable lease cost 21.1 17.9 Totalleasecost $ 34.4 $ 30.0

Cash payments related to operating leases $ 13.2 $ 12.0 Right-of-use assets obtained in exchange for new operating lease liabilities 10.8 17.0

Grace’s expense for operating leases was $13.5 million in 2018.

The following table presents the weighted average discount rate and weighted average remaining lease term related to Grace’s operatingleases.

December31,

2020Weighted average discount rate 6.2 %Weighted average remaining lease term 7.7

The following maturity analysis presents minimum expected operating lease payments at December 31, 2020.

(Inmillions)2021 $ 11.8 2022 8.7 2023 5.2 2024 3.4 2025 2.2 Thereafter 15.3 Totalundiscountedleasepayments 46.6 Less: imputed interest 10.7 Presentvalueofleaseliabilities $ 35.9

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4.GoodwillandOtherIntangibleAssets

The carrying amount of goodwill attributable to each reportable segment and the changes in those balances during the years endedDecember 31, 2020 and 2019, are as follows:

(Inmillions)Catalysts

TechnologiesMaterials

Technologies TotalGraceBalance,December31,2018 $ 496.3 $ 44.1 $ 540.4 Goodwill acquired during the year 17.8 — 17.8 Foreign currency translation (1.0) (0.3) (1.3)Balance,December31,2019 513.1 43.8 556.9 Foreign currency translation 4.4 1.4 5.8 Balance,December31,2020 $ 517.5 $ 45.2 $ 562.7

Grace’s net book value of other intangible assets at December 31, 2020 and 2019, was $320.8 million and $342.8 million, respectively, detailedas follows:

December31,2020 December31,2019

(Inmillions)GrossCarrying

AmountAccumulatedAmortization

GrossCarryingAmount

AccumulatedAmortization

Technology $ 231.6 $ 74.1 $ 232.5 $ 63.6 Customer lists 159.7 30.5 161.2 23.9 Trademarks 31.8 7.0 31.7 5.5 Other 15.7 6.4 16.1 5.7 Total $ 438.8 $ 118.0 $ 441.5 $ 98.7

Amortization expense related to intangible assets was $22.1 million, $21.9 million, and $19.9 million in 2020, 2019, and 2018, respectively.

At December 31, 2020, estimated future annual amortization expense for intangible assets is:

(Inmillions)2021 $ 21.8 2022 21.7 2023 21.7 2024 21.7 2025 21.7 Thereafter 212.2

$ 320.8

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5.Debt

ComponentsofDebt

December31,(Inmillions) 2020 20192018 U.S. dollar term loan, net of unamortized debt issuance costs of $6.0 at December 31, 2020 (2019—$7.2) $ 922.6 $ 930.9 4.875% senior notes due 2027, net of unamortized debt issuance costs of $10.1 at December 31, 2020 739.9 — 5.625% senior notes due 2024, net of unamortized debt issuance costs of $1.9 at December 31, 2020 (2019—

$2.4) 298.1 297.6 5.125% senior notes due 2021, net of unamortized debt issuance costs (2019—$2.7) — 697.3 Debt payable to unconsolidated affiliate 25.6 47.4 Other borrowings(1) 4.2 7.2 Totaldebt 1,990.4 $ 1,980.4 Lessdebtpayablewithinoneyear 15.3 $ 23.1 Debtpayableafteroneyear $ 1,975.1 $ 1,957.3

Weighted average interest rates on total debt 3.5 % 3.8 %___________________________________________________________________________________________________________________

(1) Represents borrowings under various lines of credit and other borrowings, primarily by non-U.S. subsidiaries.

See Note 6 for a discussion of the fair value of Grace’s debt.

The principal maturities of debt outstanding at December 31, 2020, were as follows:

(Inmillions)2021 $ 15.3 2022 14.2 2023 13.7 2024 311.4 2025 888.2 Thereafter 747.6 Total debt $ 1,990.4

Senior Notes due 2027

On June 26, 2020, Grace–Conn. (the “Issuer”) and certain of the Company’s existing domestic subsidiaries (together with the Company, the“Guarantors”), completed the sale of $750 million aggregate principal amount of 4.875% Notes due 2027 (the “Senior Notes due 2027”) for netproceeds of $741.6 million. The Senior Notes due 2027 were priced at 100% of par and were offered and sold pursuant to exemptions fromregistration under the Securities Act of 1933, as amended (the "Securities Act"). The Senior Notes due 2027 were issued pursuant to an indenture,dated as of September 16, 2014 (the “Base Indenture”), as supplemented by that certain third supplemental indenture, dated as of June 26, 2020(the “Third Supplemental Indenture”), by and among the Issuer, the Guarantors and the trustee thereunder (the “Trustee”). The Base Indenture,together with the Third Supplemental Indenture, are referred to below as the “Indenture.”

On July 13, 2020, Grace used the net proceeds, together with cash on hand, to redeem the $700.0 million Senior Notes due 2021 for$748.0 million, including $10.1 million of interest accrued through the date of redemption and a $37.9 million make-whole premium. During the threemonths ended September 30, 2020, Grace recognized a charge related to the debt refinancing of $39.4 million, including the make-whole premium.

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5.Debt(Continued)

Interest is payable on the Senior Notes due 2027 on each June 15 and December 15, commencing December 15, 2020.

Grace may redeem all or a portion of the Senior Notes due 2027 at any time prior to June 15, 2023, at a price equal to 100% of the principalamount of the Senior Notes due 2027 redeemed plus accrued and unpaid interest, if any, to but excluding the redemption date plus a make-wholepremium. At any time on or after June 15, 2023, Grace may redeem the Senior Notes due 2027, in whole or in part, at the redemption prices setforth in the Third Supplemental Indenture, in each case plus accrued and unpaid interest, if any, to but excluding the redemption date. The SeniorNotes due 2027 will mature on June 15, 2027.

If a change of control of the Company occurs while the Senior Notes due 2027 are rated below investment grade, or is followed by a belowinvestment grade rating, subject to certain exceptions, each holder shall have the right to require that the Issuer repurchase all or a portion of suchholder’s Senior Notes due 2027 at a purchase price of 101% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, onthe Senior Notes due 2027 repurchased, to but excluding, the date of repurchase.

The Senior Notes due 2027 and guarantees are senior unsecured obligations of the Issuer and the Guarantors, respectively, and will rankequally with all of the existing and future unsubordinated obligations of the Issuer and the Guarantors, respectively. The Senior Notes due 2027 andthe guarantees are effectively subordinated to any secured indebtedness to the extent of the value of the assets securing such indebtedness andstructurally subordinated to the debt and other liabilities of the Company’s non-guarantor subsidiaries.

The Senior Notes due 2027 were issued subject to covenants that limit the ability of the Company, the Issuer, and certain of the Company’ssubsidiaries to: (i) incur liens on assets; (ii) enter into sale and leaseback transactions larger than the greater of $100 million or 2.5% of total assets;and (iii) merge or consolidate with another company; subject to certain exceptions and qualifications. Grace is in compliance with those covenants.

The Senior Notes due 2027 were issued subject to customary events of default, which include (subject in certain cases to customary grace andcure periods), among others, nonpayment of principal or interest; breach of other agreements in the Indenture; failure to pay certain otherindebtedness; failure to discharge a final judgment for payment of the greater of (i) $100 million and (ii) 2.5% of Total Assets (as defined in theIndenture) or more (excluding any amounts covered by insurance or indemnities) rendered against the Issuer or any of its significant subsidiaries;and certain events of bankruptcy or insolvency. Generally, if any event of default occurs, the Trustee or the holders of at least 30% in aggregateprincipal amount of the then outstanding series of Senior Notes due 2027 may declare all the Senior Notes due 2027 of such series to be due andpayable immediately.

The foregoing is a summary of the Senior Notes due 2027 and the related indentures, does not purport to be complete, and is qualified in itsentirety by reference to the full texts thereof. Grace has filed the full text of such documents with the SEC, which are readily available on the internetat www.sec.gov.

Credit Agreement

On April 3, 2018, Grace entered into a Credit Agreement (the “Credit Agreement”), which provides for new senior secured credit facilities,consisting of:

(a) a $950 million term loan due in 2025, with interest at LIBOR +175 basis points, and(b) a $400 million revolving credit facility due in 2023, with interest at LIBOR +175 basis points.

The term loan amortizes in equal quarterly installments in aggregate annual amounts of $9.5 million.

The Credit Agreement contains customary affirmative covenants, including, but not limited to: (i) maintenance of existence, and compliancewith laws; (ii) delivery of consolidated financial statements and other information; (iii) payment of taxes; (iv) delivery of notices of defaults and certainother material events; and (v) maintenance of adequate insurance. The Credit Agreement also contains customary negative covenants, includingbut not limited to restrictions on: (i) dividends on, and redemptions of, equity interests and other restricted payments; (ii) liens; (iii) loans andinvestments; (iv) the sale, transfer or disposition of assets and businesses; (v) transactions with affiliates; and (vi) a maximum first lien leverageratio.

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5.Debt(Continued)

Events of default under the Credit Agreement include, but are not limited to: (i) failure to pay principal, interest, fees or other amounts under theCredit Agreement when due, taking into account any applicable grace period; (ii) any representation or warranty proving to have been incorrect inany material respect when made; (iii) failure to perform or observe covenants or other terms of the Credit Agreement subject to certain graceperiods; (iv) a cross-default and cross-acceleration with certain other material debt; (v) bankruptcy events; (vi) certain defaults under ERISA; and(vii) the invalidity or impairment of security interests.

To secure its obligations under the Credit Agreement, Grace and certain of its U.S. subsidiaries have granted security interests in substantiallyall equity and debt interests in Grace–Conn. or any other Grace subsidiary owned by them and in substantially all their non-real estate assets andproperty.

Grace used a portion of the proceeds to repay in full the borrowings outstanding under its 2014 credit agreement, which was terminated, aswell as to make a voluntary $50.0 million accelerated contribution to its U.S. qualified pension plans. In connection with the repayment of debt,Grace recorded a $4.8 million loss on early extinguishment of debt, which is included in “other (income) expense” in the Consolidated Statement ofOperations.

Grace had no outstanding draws on its revolving credit facility as of December 31, 2020; however, the available credit under the facility wasreduced to $391.8 million by outstanding letters of credit.

Senior Notes due 2021 and 2024

On September 16, 2014, Grace–Conn. (the “Issuer”) issued $1,000.0 million of senior unsecured notes (the “Notes”) in two tranches:

(a) $700 million in aggregate principal amount of Notes due 2021 at a coupon rate of 5.125%, and(b) $300 million in aggregate principal amount of Notes due 2024 at a coupon rate of 5.625%.

The Notes were priced at 100% of par and were offered and sold pursuant to exemptions from registration under the Securities Act of 1933, asamended, (the “Securities Act”). Interest is payable on the Notes on each April 1 and October 1.

Grace may redeem some or all of the Notes at any time at a price equal to the greater of (i) 100% of the principal amount of the Notesredeemed plus accrued and unpaid interest and (ii) the sum, as determined by an independent investment banker, of the present values of theremaining scheduled payments of principal and interest (exclusive of interest accrued to the date of redemption) discounted to the redemption dateon a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate plus 50 basis points, in each case, plusaccrued and unpaid interest. In the event of a change in control, Grace will be required to offer to purchase the Notes at a price equal to 101% of theaggregate principal amount outstanding plus accrued and unpaid interest. On July 13, 2020, Grace redeemed the $700.0 million Senior Notes due2021.

The Notes are jointly and severally guaranteed on a full and unconditional senior unsecured basis by the Company and Alltech Associates,Inc., a wholly-owned subsidiary of the Issuer (the “Guarantors”). The Notes and guarantees are senior obligations of the Issuer and the Guarantors,respectively, and will rank equally with all of the existing and future unsubordinated obligations of the Issuer and the Guarantors, respectively. TheNotes are effectively subordinated to any secured indebtedness to the extent of the value of the assets securing such indebtedness, and structurallysubordinated to the debt and other liabilities of Grace’s non-guarantor subsidiaries.

The Notes were issued subject to covenants that limit the Issuer’s and certain of its subsidiaries’ ability, subject to certain exceptions andqualifications, to (i) create or incur liens on assets, (ii) enter into any sale and leaseback transaction and (iii) in the case of the Issuer, merge orconsolidate with another company. Grace is in compliance with these covenants.

The Notes were also issued subject to customary events of default which include (subject in certain cases to customary grace and cureperiods), among others, nonpayment of principal or interest; breach of other agreements in the Indenture; failure to pay certain other indebtedness;failure to discharge a final judgment for the payment of $75 million or more (excluding any amounts covered by insurance or indemnities) renderedagainst

78



5.Debt(Continued)

the Issuer or any of its significant subsidiaries; and certain events of bankruptcy or insolvency. Generally, if any event of default occurs, the trusteeor the holders of at least 25% in aggregate principal amount of the then outstanding series of Notes may declare all the Notes of such series to bedue and payable immediately.

The foregoing is a summary of the Credit Agreement, the indentures, and the Notes. Grace has filed the full text of such agreements with theSEC, which are readily available on the Internet at www.sec.gov.

6.FairValueMeasurementsandRisk

Certain of Grace’s assets and liabilities are reported at fair value on a gross basis. ASC 820 “Fair Value Measurements and Disclosures”defines fair value as the value that would be received at the measurement date in the principal or “most advantageous” market. Grace uses principalmarket data, whenever available, to value assets and liabilities that are required to be reported at fair value.

Grace has identified the following financial assets and liabilities that are subject to the fair value analysis required by ASC 820:

Fair Value of Debt and Other Financial Instruments Debt payable is recorded at carrying value. Fair value is determined based on Level 2inputs, including expected future cash flows (discounted at market interest rates), estimated current market prices, and quotes from financialinstitutions.

At December 31, 2020, the carrying amounts, net of unamortized debt issuance costs and discounts (see Note 5), and fair values of Grace’sdebt were as follows:

December31,2020 December31,2019(Inmillions) CarryingAmount FairValue CarryingAmount FairValue2018 U.S. dollar term loan $ 922.6 $ 904.1 $ 930.9 $ 938.1 4.875% senior notes due 2027 739.9 784.7 — — 5.625% senior notes due 2024 298.1 322.4 297.6 329.2 5.125% senior notes due 2021 — — 697.3 727.1 Other borrowings 29.8 29.8 54.6 54.6 Totaldebt $ 1,990.4 $ 2,041.0 $ 1,980.4 $ 2,049.0

At December 31, 2020, the recorded values of other financial instruments such as cash equivalents and trade receivables and payablesapproximated their fair values, based on the short-term maturities and floating rate characteristics of these instruments.

Currency Derivatives Because Grace operates and/or sells to customers in over 60 countries and in over 30 currencies, its results areexposed to fluctuations in currency exchange rates. Grace seeks to minimize exposure to these fluctuations by matching sales with expenditures inthe same currencies, but it is not always possible to do so. From time to time, Grace uses financial instruments such as currency forward contracts,options, swaps, or combinations thereof to reduce the risk of certain specific transactions. However, Grace does not have a policy of hedging allexposures, because management does not believe that such a level of hedging would be cost-effective. Forward contracts with maturities of notmore than 36 months are used and designated as cash flow hedges of forecasted repayments of intercompany loans. The effective portion of gainsand losses on these currency hedges is recorded in “accumulated other comprehensive income (loss)” and reclassified into “other (income)expense, net” to offset the remeasurement of the underlying hedged loans. Forward points are excluded from the assessment of effectiveness andamortized to income on a systematic basis.

Grace also enters into foreign currency forward contracts and swaps to hedge a portion of its net outstanding monetary assets and liabilities.These forward contracts and swaps are not designated as hedging instruments under applicable accounting guidance, and therefore all changes intheir fair value are recorded in “other (income) expense, net,” in the Consolidated Statements of Operations. These forward contracts and swaps areintended to offset the foreign currency gains or losses associated with the underlying monetary assets and liabilities.

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6.FairValueMeasurementsandRisk(Continued)

The valuation of Grace’s currency exchange rate forward contracts and swaps is determined using an income approach. Inputs used to valuecurrency exchange rate forward contracts and swaps consist of: (1) spot rates, which are quoted by various financial institutions; (2) forward points,which are primarily affected by changes in interest rates; and (3) discount rates used to present value future cash flows, which are based on theLondon Interbank Offered Rate (LIBOR) curve or overnight indexed swap rates. Total notional amounts for forward contracts and swaps outstandingat December 31, 2020, were $419.2 million.

Cross-Currency Swap Agreements Grace uses cross-currency swaps designated as cash flow hedges to manage fluctuations in currencyexchange rates and interest rates on variable rate debt. Gains and losses on these cash flow hedges are recorded in “accumulated othercomprehensive income (loss)” and reclassified into “other (income) expense, net” and “interest expense and related financing costs” during thehedged period.

In connection with the Credit Agreement (see Note 5), Grace entered into new cross-currency swaps beginning on April 3, 2018, and maturingon March 31, 2023, to synthetically convert $600.0 million of U.S. dollar-denominated floating rate debt into €490.1 million of euro-denominated debtfixed at 2.0231%. These cross-currency swaps were de-designated and terminated on November 5, 2018, and replaced with new, at-market cross-currency swaps beginning on November 5, 2018, and maturing on March 31, 2023, to synthetically convert $600.0 million of U.S. dollar-denominated floating rate debt into €525.9 million of euro-denominated debt fixed at 1.785%. Grace received $33.1 million in cash proceeds fromthe swap settlement. The valuation of these cross-currency swaps is determined using an income approach, using LIBOR and EURIBOR (EuroInterbank Offered Rate) swap curves, currency basis spreads, and euro/U.S. dollar exchange rates.

Debt and Interest Rate Swap Agreements Grace uses interest rate swaps designated as cash flow hedges to manage fluctuations ininterest rates on variable rate debt. The effective portion of gains and losses on these interest rate cash flow hedges is recorded in “accumulatedother comprehensive income (loss)” and reclassified into “interest expense and related financing costs” during the hedged interest period.

In connection with the Credit Agreement, Grace entered into interest rate swaps beginning on April 3, 2018, and maturing on March 31, 2023,fixing the LIBOR component of the interest on $100.0 million of term debt at 2.775%. The valuation of these interest rate swaps is determined usingan income approach, using prevailing market interest rates and discount rates to present value future cash flows based on the forward LIBOR yieldcurves. Credit risk is also incorporated into derivative valuations.

The following tables present the fair value hierarchy for financial assets and liabilities measured at fair value on a recurring basis as ofDecember 31, 2020 and 2019:

FairValueMeasurementsatDecember31,2020,Using

(Inmillions) Total

QuotedPricesinActiveMarketsforIdenticalAssetsorLiabilities

(Level1)

SignificantOtherObservableInputs

(Level2)

SignificantUnobservableInputs(Level3)

AssetsCurrency derivatives $ 1.6 $ — $ 1.6 $ — TotalAssets $ 1.6 $ — $ 1.6 $ — LiabilitiesCurrency derivatives $ 17.8 $ — $ 17.8 $ — Variable-to-fixed cross-currency derivatives 51.0 — 51.0 — Interest rate derivatives 5.5 — 5.5 — TotalLiabilities $ 74.3 $ — $ 74.3 $ —

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(Inmillions) Total

QuotedPricesinActiveMarketsforIdenticalAssetsorLiabilities

(Level1)


(Level2)

SignificantUnobservableInputs(Level3)

AssetsCurrency derivatives $ 6.1 $ — $ 6.1 $ — Variable-to-fixed cross-currency derivatives 3.4 — 3.4 — TotalAssets $ 9.5 $ — $ 9.5 $ — LiabilitiesCurrency derivatives $ 0.9 $ — $ 0.9 $ — Interest rate derivatives 3.4 — 3.4 — TotalLiabilities $ 4.3 $ — $ 4.3 $ —

The following tables present the location and fair values of derivative instruments included in the Consolidated Balance Sheets as ofDecember 31, 2020 and 2019:

AssetDerivatives LiabilityDerivativesDecember31,2020(Inmillions)

BalanceSheetLocation

FairValue


FairValue

DerivativesdesignatedashedginginstrumentsunderASC815:Currency contracts Other current assets $ — Other current liabilities $ 17.7 Currency contracts Other assets — Other liabilities 0.1 Interest rate contracts Other current assets — Other current liabilities 2.5 Interest rate contracts Other assets — Other liabilities 3.0 Variable-to-fixed cross-currency swaps Other current assets — Other current liabilities 0.2 Variable-to-fixed cross-currency swaps Other liabilities — Other liabilities 50.8 DerivativesnotdesignatedashedginginstrumentsunderASC

815:Currency contracts Other current assets 1.9 Other current assets — Currency contracts Other current liabilities (0.3) Other current liabilities — Totalderivatives $ 1.6 $ 74.3

AssetDerivatives LiabilityDerivativesDecember31,2019(Inmillions)


FairValue


FairValue

DerivativesdesignatedashedginginstrumentsunderASC815:Currency contracts Other current assets $ 2.1 Other current assets $ (3.1)Currency contracts Other assets 4.0 Other liabilities 4.0 Interest rate contracts Other current assets — Other current liabilities 1.0 Interest rate contracts Other assets — Other liabilities 2.4 Variable-to-fixed cross-currency swaps Other current assets 10.2 Other current liabilities — Variable-to-fixed cross-currency swaps Other liabilities (6.8) Other liabilities — DerivativesnotdesignatedashedginginstrumentsunderASC

815:Currency contracts Other current assets — Other current assets (0.2)Currency contracts Other current assets — Other current liabilities 0.2 Totalderivatives $ 9.5 $ 4.3

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The following tables present the location and amount of gains and losses on derivative instruments included in the Consolidated Statements ofOperations or, when applicable, gains and losses initially recognized in “other comprehensive income (loss)” (“OCI”) for the years endedDecember 31, 2020, 2019, and 2018:

YearEndedDecember31,2020(Inmillions)

AmountofGain(Loss)RecognizedinOCIon

Derivatives

LocationofGain(Loss)ReclassifiedfromAccumulated

OCIintoIncome

AmountofGain(Loss)Reclassifiedfrom

AccumulatedOCIintoIncome

DerivativesinASC815cashflowhedgingrelationships:Interest rate contracts $ (4.0) Interest expense $ (1.8)Currency contracts(1) 1.8 Other expense 2.3 Variable-to-fixed cross-currency swaps 7.2 Interest expense 4.0 Variable-to-fixed cross-currency swaps (55.4) Other expense (55.4)Totalderivatives $ (50.4) $ (50.9)

LocationofGain(Loss)RecognizedinIncomeon

Derivatives

AmountofGain(Loss)RecognizedinIncome

onDerivativesDerivativesnotdesignatedashedginginstrumentsunderASC815:Currency contracts Other expense $ 4.9 ___________________________________________________________________________________________________________________

(1) Amount of gain (loss) recognized in OCI includes $(0.7) million excluded from the assessment of effectiveness for which the difference betweenchanges in fair value and periodic amortization is recorded in OCI.



Derivatives


OCIintoIncome



DerivativesinASC815cashflowhedgingrelationships:Interest rate contracts $ (2.9) Interest expense $ (0.3)Currency contracts(1) 2.4 Other expense 1.4 Variable-to-fixed cross-currency swaps 9.1 Interest expense 13.2 Variable-to-fixed cross-currency swaps 12.5 Other expense 12.5 Totalderivatives $ 21.1 $ 26.8


Derivatives


onDerivativesDerivativesnotdesignatedashedginginstrumentsunderASC815:Currency contracts Other expense $ (0.4)___________________________________________________________________________________________________________________

(1) Amount of gain (loss) recognized in OCI includes $0.6 million excluded from the assessment of effectiveness for which the difference between changesin fair value and periodic amortization is recorded in OCI.

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Derivatives


OCIintoIncome



DerivativesinASC815cashflowhedgingrelationships:Interest rate contracts $ 0.4 Interest expense $ (0.6)Currency contracts(1) 6.3 Other expense 6.3 Variable-to-fixed cross-currency swaps (0.6) Interest expense 9.7 Variable-to-fixed cross-currency swaps 40.5 Other expense 40.5 Totalderivatives $ 46.6 $ 55.9


Derivatives


onDerivativesDerivativesnotdesignatedashedginginstrumentsunderASC815:Currency contracts Other expense $ (4.0)___________________________________________________________________________________________________________________

(1) Amount of gain (loss) recognized in OCI includes $(0.4) million excluded from the assessment of effectiveness for which the difference betweenchanges in fair value and periodic amortization is recorded in OCI.

The following table presents the total amounts of income and expense line items presented in the Consolidated Statements of Operations inwhich the effects of cash flow hedges are reported.


(Inmillions)Interestexpense

Otherincome(expense)

Interestexpense


Interestexpense


TotalamountsofincomeandexpenselineitemsintheConsolidatedStatementsofOperationsinwhichtheeffectsofcashflowhedgesarerecorded $ (76.0) $ (89.0) $ (76.7) $ (80.6) $ (80.2) $ 23.2

Gain(loss)oncashflowhedgingrelationshipsinASC815Interest rate contractsGain (loss) reclassified from accumulated OCI into income $ (1.8) $ — $ (0.3) $ — $ (0.6) $ —

Variable-to-fixed cross-currency swapsGain (loss) reclassified from accumulated OCI into income 4.0 (55.4) 13.2 12.5 9.7 40.5

Currency contractsGain (loss) reclassified from accumulated OCI into income — 2.3 — 1.4 — 6.3 Amount excluded from effectiveness testing recognized in earnings based onamortization approach (included in above) — 1.2 — 2.8 — 3.0

Net Investment Hedges Grace uses cross-currency swaps as derivative hedging instruments in certain net investment hedges of its non-U.S. subsidiaries. The gains and losses attributable to these net investment hedges, adjusted for the impact of excluded components, are recordednet of tax to “currency translation adjustments” within “accumulated other comprehensive income (loss)” to offset the change in the carrying value ofthe net investment being hedged. Recognition in earnings of amounts previously recorded to “currency translation adjustments” is limited tocircumstances such as complete or substantially complete liquidation of the net investment in the hedged foreign operation. Changes in the fairvalue of the hedging instrument related to time value, which are excluded from the assessment of hedge effectiveness, are recorded directly tointerest expense on a systematic basis. These gains were $3.0 million, $3.3 million and $2.3 million for the years ended December 31, 2020, 2019,and 2018, respectively. At December 31, 2020, the notional amount of €170.0 million

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of Grace’s cross-currency swaps was designated as a hedging instrument of its net investment in its European subsidiaries.

Grace has also used foreign currency-denominated debt and deferred intercompany royalties as non-derivative hedging instruments in certainnet investment hedges. At December 31, 2020, Grace’s deferred intercompany royalties have been fully amortized and de-designated as a hedginginstrument of its net investment in its European subsidiaries. In April 2018, in connection with the Credit Agreement, Grace de-designated andrepaid its euro-denominated term loan principal that had been designated as a hedge of its net investment in its European subsidiaries.

The following table presents the amount of gains and losses on derivative and non-derivative instruments designated as net investment hedgesrecorded to “currency translation adjustments” within “accumulated other comprehensive income (loss)” for the years ended December 31, 2020,2019, and 2018. There were no reclassifications of the effective portion of net investment hedges out of OCI and into earnings for the periodspresented.

YearEndedDecember31,(Inmillions) 2020 2019 2018DerivativesinASC815netinvestmenthedgingrelationships:Cross-currency swap $ (15.9) $ 9.1 $ 6.0 Non-derivativesinASC815netinvestmenthedgingrelationships:Foreign currency denominated debt $ — $ — $ (4.4)Foreign currency denominated deferred intercompany royalties — 0.1 0.5

$ — $ 0.1 $ (3.9)

Credit Risk Grace is exposed to credit risk in its trade accounts receivable. Grace’s credit evaluation policies mitigate credit risk exposures,and it has a history of minimal credit losses. Grace does not generally require collateral for its trade accounts receivable, but may require a bankletter of credit in certain instances, particularly when selling to customers in cash-restricted countries.

Grace may also be exposed to credit risk in its derivatives contracts. Grace monitors counterparty credit risk and currently does not anticipatenonperformance by counterparties to its derivatives. Grace’s derivative contracts are with internationally recognized commercial financial institutions.

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7.IncomeTaxes

Provision for Income Taxes The components of income from continuing operations before income taxes and the related provision forincome taxes for 2020, 2019, and 2018 are as follows:

(Inmillions) 2020 2019 2018Incomefromcontinuingoperationsbeforeincometaxes: Domestic $ (76.1) $ 79.2 $ 82.2 Foreign 76.6 104.3 162.7 Total $ 0.5 $ 183.5 $ 244.9 Benefitfrom(provisionfor)incometaxes: Federal—current $ (0.3) $ (6.3) $ (4.9)Federal—deferred 24.8 (19.8) (29.3)State and local—current — (0.5) 1.6 State and local—deferred (7.2) (5.8) (3.5)Foreign—current (35.1) (42.4) (49.9)Foreign—deferred 15.6 18.0 7.9 Total $ (2.2) $ (56.8) $ (78.1)

The difference between the benefit from (provision for) income taxes on continuing operations at the U.S. federal income tax rate of 21% andGrace’s overall income tax provision is summarized as follows:

(Inmillions) 2020 2019 2018Tax provision at U.S. federal income tax rate $ (0.1) $ (38.5) $ (51.4)Changeinbenefit(provision)resultingfrom:GILTI high-tax exclusion amended return 25.2 — — Decrease (increase) in valuation allowance (13.5) (4.2) (6.3)Nontaxable income/non-deductible expenses (4.6) (2.5) (1.6)U.S. taxes on foreign earnings (3.9) (16.7) (30.9)State and local income taxes, net (3.4) (3.4) (1.9)Research and development credit 3.3 3.4 9.4 Unrecognized tax benefit (accruals) releases (3.1) 2.3 5.7 Effect of tax rate differential in foreign jurisdictions (2.0) (2.9) (11.3)Compensation-related adjustments (1.8) (1.7) (3.4)Provision to return adjustments (0.3) 3.0 (0.7)Benefits (charges) related to U.S. tax reform — — 17.1 Other 2.0 4.4 (2.8)Benefitfrom(provisionfor)incometaxes $ (2.2) $ (56.8) $ (78.1)

Our 2020 effective tax rate was significantly higher than the 21% U.S. statutory rate primarily due to proportionally lower pre-tax income and toan increase to the valuation allowance on U.S. federal tax credits and the higher statutory rates in effect for our foreign subsidiaries, partially offsetby the benefit from the Global Intangible Low-Taxed Income (“GILTI”) high-tax exclusion (“HTE”) tax benefit elected for tax years 2018 through2020.

On July 20, 2020, the U.S. Treasury Department released final regulations related to the GILTI HTE. Grace has recognized a benefitassociated with the GILTI HTE regulations that resulted in a tax benefit related to 2018 and 2019 of $25.2 million resulting from the election and there-establishment of certain U.S. federal net operating loss carryforwards, research and development credit carryforwards, and foreign tax creditcarryforwards.

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7.IncomeTaxes(Continued)

Deferred Tax Assets and Liabilities As of December 31, 2020 and 2019, the tax attributes giving rise to deferred tax assets and liabilitiesconsisted of the following items.

December31,(Inmillions) 2020 2019Deferredtaxassets:Tax credit carryforwards $ 309.2 $ 294.7 Pension liabilities 139.2 107.7 Net operating loss carryforwards 65.2 60.3 Environmental remediation liabilities 50.3 47.0 Research and development 32.9 26.6 Unrealized currency gains and losses 30.7 12.1 Reserves and allowances 29.6 14.8 Operating lease liabilities 7.4 8.1 Compensation-related 4.0 5.4 Prepaid royalties 1.1 6.3 Other 6.8 6.9 Total deferred tax assets $ 676.4 $ 589.9 Deferredtaxliabilities:Intangible assets $ (36.5) $ (27.7)Properties and equipment (20.5) (18.6)Operating lease assets (7.4) (8.0)Other (16.6) (1.4)Total deferred tax liabilities $ (81.0) $ (55.7)Valuationallowances (38.7) (24.1)Netdeferredtaxassets $ 556.7 $ 510.1

Grace reduces the carrying amounts of deferred tax assets by a valuation allowance if, based on the available evidence, it is more likely thannot that such assets will not be realized (see Note 1). Based on all available evidence considered, Grace believes it is more likely than not that someportion of the U.S federal foreign tax credit carryforwards recorded will not ultimately be realized. As of December 31, 2020, a valuation allowance of$11.5 million was recorded against the more-likely-than-not U.S. federal foreign tax credit carryforwards expiring in 2021.

Tax Attributes—Tax Credit and Net Operating Loss Carryforwards Grace has $317.4 million in federal tax credit carryforwards and$13.1 million in federal net operating loss carryforwards before valuation allowances and unrecognized tax benefits. In order to fully utilize thecredits before they expire (from 2021 to 2040), Grace would need to generate income of approximately $1.6 billion.

Grace has state net operating loss carryforwards of $47.4 million and state tax credits of $1.6 million before valuation allowances andunrecognized tax benefits. In order to fully utilize the state tax attributes before they expire (from 2021 to 2036), Grace would need to generateapproximately $3.1 billion in state taxable income.

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7.IncomeTaxes(Continued)

The following table presents Grace’s tax effected net operating loss carryforwards and the related valuation allowances.

December31,(Inmillions) 2020 2019NetoperatinglosscarryforwardsU.S. state net operating losses $ 45.4 $ 49.5 U.S. federal net operating losses 10.2 1.2 Foreign net operating losses 9.6 9.6 Netoperatinglosscarryforwards $ 65.2 $ 60.3

Netoperatingloss—valuationallowancesU.S. state—NOL valuation allowances $ (13.9) $ (10.1)Foreign—NOL valuation allowances (6.5) (8.0)Netoperatingloss—valuationallowances $ (20.4) $ (18.1)

Unrecognized Tax Benefits The balance of unrecognized tax benefits at December 31, 2020, was $18.6 million compared with $15.4 millionat December 31, 2019. A rollforward of the balance of unrecognized tax benefits for the three years ended December 31, 2020, follows.

December31,(Inmillions) 2020 2019 2018Balanceatbeginningofyear $ 15.4 $ 14.1 $ 17.7 Increase (decrease) in positions taken in prior periods 0.2 2.6 1.2 Positions taken in the current period 3.4 2.9 0.9 Decrease due to settlements with tax authorities (0.4) (4.2) (5.7)Balanceatendofyear $ 18.6 $ 15.4 $ 14.1

If the balance of unrecognized tax benefits as of December 31, 2020, of $18.6 million is ultimately recognized, it would reduce the effective taxrate. A portion of this balance relates to tax positions that impact Grace’s deferred tax assets as of December 31, 2020. Grace accrues potentialinterest and any associated penalties related to unrecognized tax benefits in “benefit from (provision for) income taxes” in the ConsolidatedStatements of Operations. Grace accrued $0.2 million of interest and penalties associated with these unrecognized tax benefits in 2020. Gracebelieves that the amount of the liability for unrecognized tax benefits will not change materially in the next 12 months.

Grace is subject to taxation in the U.S. and various state and foreign jurisdictions and is under continual audit by various tax authorities. As ofDecember 31, 2020, tax years 2017 through 2019 are subject to examination by the U.S. tax authorities. In the significant non-U.S. jurisdiction, taxyears 2017 through 2019 are subject to examination by the German tax authorities. Grace has tax attributes generated in prior years that areotherwise closed by statute and were carried forward into years that are open to examination. Those attributes may still be subject to adjustment tothe extent utilized in open years.

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8.PensionPlansandOtherRetirementPlans

Pension Plans The following table presents the funded status of Grace’s pension plans:

December31,(Inmillions) 2020 2019Overfunded defined benefit pension plans $ 11.4 $ 8.5 Underfunded defined benefit pension plans (128.3) (85.2)Unfunded defined benefit pension plans (520.7) (434.6)Total underfunded and unfunded defined benefit pension plans (649.0) (519.8)Pension liabilities included in other current liabilities (15.7) (14.8)Netfundedstatus $ (653.3) $ (526.1)

Fully-funded plans include several advance-funded plans where the fair value of the plan assets exceeds the projected benefit obligation("PBO"). Underfunded plans include a group of advance-funded plans that are underfunded on a PBO basis. Unfunded plans include several plansthat are funded on a pay-as-you-go basis, and therefore, the entire PBO is unfunded.

Grace maintains defined benefit pension plans covering current and former employees of certain business units and divested business unitswho meet age and service requirements. Benefits are generally based on final average salary and years of service. Grace funds its U.S. qualifiedpension plans (“U.S. qualified pension plans”) in accordance with U.S. federal laws and regulations. Non-U.S. pension plans (“non-U.S. pensionplans”) are funded under a variety of methods, as required under local laws and customs. The U.S. salaried plan was closed to new entrants afterJanuary 1, 2017. In the 2021 first quarter, Grace announced to employees that the U.S. salaried plan will be frozen effective January 1, 2025.

Grace also provides, through nonqualified plans, supplemental pension benefits in excess of U.S. qualified pension plan limits imposed byfederal tax law. These plans cover officers and higher-level employees and serve to increase the combined pension amount to the level that theyotherwise would have received under the U.S. qualified pension plans in the absence of such limits. The nonqualified plans are unfunded and Gracepays the costs of benefits as they are due to the participants.

At the December 31, 2020, measurement date for Grace’s defined benefit pension plans, the PBO was $1,682.7 million as measured underU.S. GAAP compared with $1,507.0 million as of December 31, 2019. The PBO reflects the present value (using a 2.41% weighted averagediscount rate for U.S. plans and a 0.84% weighted average discount rate for non-U.S. plans as of December 31, 2020) of vested and non-vestedbenefits earned from employee service to date, based upon current services and estimated future pay increases for active employees.

On an annual basis a full remeasurement of pension assets and pension liabilities is performed based on Grace’s estimates and actuarialvaluations. These valuations reflect the terms of each pension plan and use participant-specific information as well as certain key assumptionsprovided by management.

Defined Contribution Retirement Plans Grace sponsors a defined contribution retirement plan for its employees in the United States. Thisplan is qualified under section 401(k) of the U.S. tax code. Currently, Grace contributes an amount equal to 100% of employee contributions, up to6% of an individual employee’s salary or wages. Grace’s cost related to this benefit plan was $14.3 million, $13.9 million, and $12.6 million for theyears ended December 31, 2020, 2019, and 2018, respectively.

U.S. salaried employees and certain U.S. hourly employees hired on or after January 1, 2017, participate in an enhanced defined contributionplan instead of a defined benefit pension plan. Grace contributes 4% of an individual employee’s salary or wages to this plan. Grace’s cost related tothis enhanced defined contribution plan established in the U.S. was $3.5 million, $2.9 million, and $1.7 million for the years ended December 31,2020, 2019, and 2018, respectively.

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8.PensionPlansandOtherRetirementPlans(Continued)

Analysis of Plan Accounting and Funded Status The following table summarizes the changes in benefit obligations and fair values ofretirement plan assets during 2020 and 2019:

DefinedBenefitPensionPlansU.S. Non-U.S. Total

(Inmillions) 2020 2019 2020 2019 2020 2019ChangeinProjectedBenefitObligation:Benefit obligation at beginning of year $ 1,137.8 $ 1,027.1 $ 369.2 $ 305.6 $ 1,507.0 $ 1,332.7 Service cost 18.9 15.7 11.1 8.6 30.0 24.3 Interest cost 30.2 38.3 4.1 5.4 34.3 43.7 Actuarial (gain) loss—change in discount rates 106.0 144.1 52.7 58.2 158.7 202.3 Actuarial (gain) loss—other changes 8.9 (10.7) (3.7) 4.1 5.2 (6.6)Benefits paid (79.1) (76.7) (8.4) (8.4) (87.5) (85.1)Currency exchange translation adjustments — — 35.0 (4.3) 35.0 (4.3)Benefit obligation at end of year $ 1,222.7 $ 1,137.8 $ 460.0 $ 369.2 $ 1,682.7 $ 1,507.0 ChangeinPlanAssets:Fair value of plan assets at beginning of year $ 955.7 $ 871.1 $ 25.2 $ 19.5 $ 980.9 $ 890.6 Actual return on plan assets 115.7 154.6 2.3 4.1 118.0 158.7 Employer contributions 8.4 6.7 8.8 9.1 17.2 15.8 Benefits paid (79.1) (76.7) (8.4) (8.4) (87.5) (85.1)Currency exchange translation adjustments — — 0.8 0.9 0.8 0.9 Fair value of plan assets at end of year $ 1,000.7 $ 955.7 $ 28.7 $ 25.2 $ 1,029.4 $ 980.9 Funded status at end of year (PBO basis) $ (222.0) $ (182.1) $ (431.3) $ (344.0) $ (653.3) $ (526.1)AmountsrecognizedintheConsolidatedBalanceSheets

consistof:Noncurrent assets $ 11.4 $ 8.5 $ — $ — $ 11.4 $ 8.5 Current liabilities (7.2) (7.3) (8.5) (7.5) (15.7) (14.8)Noncurrent liabilities (226.2) (183.3) (422.8) (336.5) (649.0) (519.8)Net amount recognized $ (222.0) $ (182.1) $ (431.3) $ (344.0) $ (653.3) $ (526.1)AmountsrecognizedinAccumulatedOtherComprehensive

(Income)Lossconsistof:Prior service credit $ (2.0) $ (2.6) $ (0.1) $ (0.1) $ (2.1) $ (2.7)Net amount recognized $ (2.0) $ (2.6) $ (0.1) $ (0.1) $ (2.1) $ (2.7)

DefinedBenefitPensionPlansU.S. Non-U.S.

2020 2019 2020 2019WeightedAverageAssumptionsUsedtoDetermineBenefitObligationsasof

December31:Discount rate 2.41 % 3.13 % 0.84 % 1.41 %Rate of compensation increase 4.50 % 4.50 % 2.58 % 2.59 %WeightedAverageAssumptionsUsedtoDetermineNetPeriodicBenefitCost

forYearsEndedDecember31:Discount rate for determining service cost 3.40 % 4.46 % 1.61 % 2.42 %Discount rate for determining interest cost 2.75 % 3.86 % 1.12 % 1.84 %Expected return on plan assets 5.25 % 5.75 % 4.17 % 4.43 %Rate of compensation increase 4.50 % 4.10 % 2.59 % 2.59 %

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The following table presents the components of net periodic benefit cost (income) and other amounts recognized in “other comprehensive(income) loss.”

(Inmillions)2020 2019 2018

U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S.NetPeriodicBenefitCost(Income)Service cost $ 18.9 $ 11.1 $ 15.7 $ 8.6 $ 19.2 $ 9.5 Interest cost 30.2 4.1 38.3 5.4 40.9 5.0 Expected return on plan assets (48.3) (1.0) (48.2) (0.9) (57.2) (1.0)Amortization of prior service cost (credit) (0.6) — (0.6) — (0.6) — Annual mark-to-market adjustment (gain) loss 47.5 47.1 26.8 59.1 (3.4) (9.2)Net curtailment and settlement gain — — — — (2.3) — Net periodic benefit cost (income) $ 47.7 $ 61.3 $ 32.0 $ 72.2 $ (3.4) $ 4.3 OtherChangesinPlanAssetsandBenefitObligations

RecognizedinOCIAmortization of prior service cost (credit) $ 0.6 $ — $ 0.6 $ — $ 0.6 $ — Total recognized in OCI 0.6 — 0.6 — 0.6 —

Total recognized in net periodic benefit cost (income) and OCI $ 48.3 $ 61.3 $ 32.6 $ 72.2 $ (2.8) $ 4.3

During 2020 the pension plans experienced a loss on liability mainly due to the decrease in discount rates from the prior year. A change in themortality assumption for the U.S. pension plans to better reflect anticipated future experience also contributed to the loss. The loss was partiallyoffset due to return on assets greater than expected and salary increases during the year less than expected.

The tables below present the funded status of U.S. and non-U.S. pension plans.

FundedStatusofU.S.PensionPlansFully-FundedU.S.Qualified

PensionPlans(1)UnderfundedU.S.

QualifiedPensionPlans(1)UnfundedPay-As-You-GoU.S.NonqualifiedPlans(2)

(Inmillions) 2020 2019 2020 2019 2020 2019Projected benefit obligation $ 36.5 $ 35.6 $ 1,076.3 $ 993.8 $ 109.9 $ 108.3 Fair value of plan assets 47.9 44.1 952.8 911.5 — — Fundedstatus(PBObasis) $ 11.4 $ 8.5 $ (123.5) $ (82.3) $ (109.9) $ (108.3)

FundedStatusofNon-U.S.PensionPlansUnderfundedNon-U.S.

PensionPlans(1)UnfundedPay-As-You-GoNon-U.S.PensionPlans(2)

(Inmillions) 2020 2019 2020 2019Projected benefit obligation $ 33.5 $ 29.0 $ 426.5 $ 340.2 Fair value of plan assets 28.7 25.2 — — Fundedstatus(PBObasis) $ (4.8) $ (3.8) $ (426.5) $ (340.2)___________________________________________________________________________________________________________________

(1) Plans intended to be advance-funded.(2) Plans intended to be pay-as-you-go. The U.S. unfunded plans are Grace’s supplemental executive retirement plan and other supplemental executive

pension arrangements, and the non-U.S. plans primarily relate to an unfunded German pension plan.

The accumulated benefit obligation for all defined benefit pension plans was approximately $1,590 million and $1,423 million as ofDecember 31, 2020 and 2019, respectively.

The following table presents the funded status of defined benefit pension plans that are underfunded or unfunded on an accumulated benefitobligation basis.

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(Inmillions)U.S. Non-U.S. Total

2020 2019 2020 2019 2020 2019Projected benefit obligation $ 1,186.2 $ 1,102.1 $ 429.4 $ 342.1 $ 1,615.6 $ 1,444.2 Accumulated benefit obligation 1,144.2 1,058.6 384.0 306.7 1,528.2 1,365.3 Fair value of plan assets 952.8 911.6 1.3 0.8 954.1 912.4

EstimatedExpectedFutureBenefitPaymentsIncludingFutureServicefortheFiscalYearsEnding(Inmillions)

PensionPlans

TotalPayments

U.S. Non-U.S.(1)BenefitPayments

BenefitPayments

2021 $ 84.5 $ 9.7 $ 94.2 2022 77.5 9.4 86.9 2023 76.4 9.6 86.0 2024 76.0 10.1 86.1 2025 74.2 10.2 84.4 2026 - 2030 348.6 60.5 409.1 ___________________________________________________________________________________________________________________

(1) Non-U.S. estimated benefit payments for 2021 and future periods have been translated at the applicable December 31, 2020, exchange rates.

Discount Rate Assumption The assumed discount rate for pension plans reflects the market rates for high-quality corporate bonds currentlyavailable and is subject to change based on changes in overall market interest rates. For the U.S. qualified pension plans, the assumed weightedaverage discount rate of 2.41% as of December 31, 2020, was selected by Grace, in consultation with its independent actuaries, based on a yieldcurve constructed from a portfolio of high quality bonds for which the timing and amount of cash outflows approximate the estimated payouts of theplan.

As of December 31, 2020 and 2019, the German pension plans represented approximately 92% and 91%, respectively, of the benefitobligation of the non-U.S. pension plans. The assumed weighted average discount rate as of December 31, 2020, for Germany of 0.70% wasselected by Grace, in consultation with its independent actuaries, based on a yield curve constructed from a portfolio of euro-denominated highquality bonds for which the timing and amount of cash outflows approximate the estimated payouts of the plans. The assumed discount rates for theremaining non-U.S. pension plans were determined based on the nature of the liabilities, local economic environments and available bond indices.

Investment Guidelines for Advance-Funded Pension Plans The investment goal for the U.S. qualified pension plans subject to advancefunding is to earn a long-term rate of return consistent with the related cash flow profile of the underlying benefit obligation. The plans are pursuing awell-defined risk management strategy designed to reduce investment risks as their funded status improves.

The U.S. qualified pension plans have adopted a diversified set of portfolio management strategies to optimize the risk reward profile of theplans:

• Liability hedging portfolio: primarily invested in intermediate-term and long-term investment grade corporate bonds in actively managedstrategies.

• Return-seeking portfolio: invested in a diversified set of assets designed to deliver performance in excess of the underlying liabilitieswith controls regarding the level of risk.

◦ Global public equities: the portfolio contains both domestic U.S. and non-U.S. equities that are both passively and activelymanaged. Benchmarks for individual managers include S&P 500 and Russell 2000 benchmarks as well as MSCI ACWI ex USindex.

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◦ Other investments: may include high yield bonds: fixed income portfolio of securities below investment grade including non-U.S.issuers. These portfolios combine income generation and capital appreciation opportunities globally.

• Liquidity portfolio: invested in short-term assets intended to pay periodic plan benefits and expenses.

For 2020, the expected long-term rate of return on assets for the U.S. qualified pension plans was 5.25%. Average annual returns over one-,three-, five-, and ten-year periods were approximately 13%, 9%, 10%, and 8%, respectively.

The expected return on plan assets for the U.S. qualified pension plans for 2020 was selected by Grace, in consultation with its independentactuaries, using an expected return model. The model determines the weighted average return for an investment portfolio based on the target assetallocation and expected future returns for each asset class, which were developed using a building block approach based on observable inflation,available interest rate information, current market characteristics, and historical results.

The target allocation of investment assets at December 31, 2020, and the actual allocation at December 31, 2020 and 2019, for Grace’s U.S.qualified pension plans are as follows:

TargetAllocation

PercentageofPlanAssetsDecember31,

U.S.QualifiedPensionPlansAssetCategory 2020 2020 2019Global equities 22 % 23 % 22 %Multi-asset credit 3 % 3 % 3 %Liability-hedging assets 75 % 74 % 75 %Total 100 % 100 % 100 %

The following tables present the fair value hierarchy for the U.S. qualified pension plan assets measured at fair value as of December 31, 2020and 2019.


(Inmillions) Total

QuotedPricesinActiveMarketsforIdenticalAssetsor

Liabilities(Level1)


(Level2)

SignificantUnobservableInputs

(Level3)Common/collective trust funds $ 8.1 $ — $ 8.1 $ — Annuity and immediate participation contracts 21.1 — 21.1 —

$ 29.2 $ — $ 29.2 $ — Investments measured at net asset value(1) 971.5 TotalAssetsatFairValue $ 1,000.7 ___________________________________________________________________________________________________________________

(1) In accordance with ASC 820-10, certain investments that are measured at net asset value (“NAV”) per share (or its equivalent) have not been classifiedin the fair value hierarchy. NAV is provided by the investment account manager as a practical expedient to estimate fair value. Fair values presented inthe table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Consolidated Balance Sheets.

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(Inmillions) Total


Liabilities(Level1)


(Level2)


(Level3)Common/collective trust funds $ 8.0 $ — $ 8.0 $ — Annuity and immediate participation contracts 20.5 — 20.5 —

$ 28.5 $ — $ 28.5 $ — Investments measured at net asset value(1) 927.2 TotalAssetsatFairValue $ 955.7 ___________________________________________________________________________________________________________________

(1) In accordance with ASC 820-10, certain investments that are measured at NAV per share (or its equivalent) have not been classified in the fair valuehierarchy. NAV is provided by the investment account manager as a practical expedient to estimate fair value. Fair values presented in the table areintended to permit reconciliation of the fair value hierarchy to the amounts presented in the Consolidated Balance Sheets.

Non-U.S. pension plans accounted for approximately 3% of total global pension assets at December 31, 2020 and 2019. Each of these plans,where applicable, follows local requirements and regulations. Some of the local requirements include the establishment of a local pensioncommittee, a formal statement of investment policy and procedures, and routine valuations by plan actuaries.

The target allocation of investment assets for non-U.S. pension plans varies depending on the investment goals of the individual plans. Theplan assets of the Canadian pension plan represent approximately 95% and 96% of the total non-U.S. pension plan assets at December 31, 2020and 2019, respectively The expected long-term rate of return on assets for the Canadian pension plan was 4.25% for 2020.

The target allocation of investment assets at December 31, 2020, and the actual allocation at December 31, 2020 and 2019, for the Canadianpension plan are as follows:

TargetAllocation

PercentageofPlanAssetsDecember31,

CanadianPensionPlanAssetCategory 2020 2020 2019Equity securities 23 % 25 % 25 %Bonds 65 % 63 % 62 %Other investments 12 % 12 % 13 %Total 100 % 100 % 100 %

The plan assets of the other country plans represent approximately 5% and 4% in the aggregate of total non-U.S. pension plan assets atDecember 31, 2020 and 2019, respectively.

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The following tables present the fair value hierarchy for the non-U.S. pension plan assets measured at fair value as of December 31, 2020 and2019.


(Inmillions) Total


Liabilities(Level1)


(Level2)


(Level3)Corporate bonds $ 0.5 $ — $ 0.5 $ — Insurance contracts and other investments 0.5 — 0.5 — Cash 0.2 0.2 — —

$ 1.2 $ 0.2 $ 1.0 $ — Investments measured at net asset value(1) 27.5 TotalAssetsatFairValue $ 28.7 ___________________________________________________________________________________________________________________



(Inmillions) Total


Liabilities(Level1)


(Level2)


(Level3)Corporate bonds $ 0.4 $ — $ 0.4 $ — Insurance contracts and other investments 0.5 — 0.5 — Cash 0.1 0.1 — —

$ 1.0 $ 0.1 $ 0.9 $ — Investments measured at net asset value(1) 24.2 TotalAssetsatFairValue $ 25.2 ___________________________________________________________________________________________________________________


Plan Contributions and Funding Grace intends to satisfy its funding obligations under the U.S. qualified pension plans and to comply withall of the requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”). For ERISA purposes, funded status is calculated on adifferent basis than under U.S. GAAP. Based on the U.S. qualified pension plans’ status as of December 31, 2020, there is a $0.5 million minimumrequired payment under ERISA for 2021.

Grace intends to fund non-U.S. pension plans based on applicable legal requirements and actuarial and trustee recommendations. Graceexpects to make contributions of approximately $10 million related to its non-U.S. pension plans in 2021.

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9.OtherBalanceSheetAccounts

December31,(Inmillions) 2020 2019OtherCurrentAssetsNon-trade accounts receivable $ 23.1 $ 24.1 Income taxes receivable (see Note 7) 7.6 4.2 Fair value of currency, interest rate, and commodity contracts (see Note 6) 2.2 15.6 Plant under construction—unconsolidated affiliate (see Note 19) — 173.9 Other current assets 18.3 17.3

$ 51.2 $ 235.1

December31,(Inmillions) 2020 2019OtherCurrentLiabilitiesAccrued compensation $ 60.6 $ 53.6 Deferred revenue (see Note 17) 33.8 35.0 Fair value of currency, interest rate, and commodity contracts (see Note 6) 21.6 2.6 Liability for dam spillway replacement (see Note 10) 20.3 4.7 Pension liabilities (see Note 8) 15.7 14.8 Environmental contingencies (see Note 10) 13.8 17.8 Operating lease liabilities (see Note 3) 10.1 9.3 Accrued interest (see Note 5) 5.8 13.3 Income taxes payable (see Note 7) 5.1 8.6 Liability to unconsolidated affiliate for plant under construction (see Note 19) — 173.9 Other accrued liabilities 95.1 86.1

$ 281.9 $ 419.7

Accrued compensation includes salaries and wages as well as estimated current amounts due under the annual and long-term incentiveprograms.

December31,(Inmillions) 2020 2019OtherLiabilitiesEnvironmental contingencies (see Note 10) $ 95.4 $ 97.5 Liability for dam spillway replacement (see Note 10) 69.3 61.7 Fair value of currency and interest rate contracts (see Note 6) 53.9 13.2 Operating lease liabilities (see Note 3) 25.8 26.2 Legacy product liability (see Note 10) 24.0 24.0 Deferred revenue (see Note 17) 23.4 29.5 Retained obligations of divested businesses 12.2 12.7 Deferred income taxes (see Note 7) 10.4 7.5 Asset retirement obligation 9.6 9.4 Unrecognized tax benefits (see Note 7) 3.9 4.1 Other noncurrent liabilities 19.7 22.4

$ 347.6 $ 308.2

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10.CommitmentsandContingentLiabilities

LegacyMatters

Over the years, Grace operated numerous types of businesses that are no longer part of its ongoing operations. As Grace divested orotherwise ceased operating these businesses, it retained certain liabilities and obligations, which Grace refers to as legacy liabilities. These liabilitiesinclude product, environmental, and other liabilities. Although the outcome of each of the matters discussed below cannot be predicted withcertainty, Grace has assessed its risk and has recorded estimated liabilities as required under U.S. GAAP.

Legacy Product Liabilities Grace emerged from an asbestos-related Chapter 11 bankruptcy on February 3, 2014 (the “Effective Date”).Under its plan of reorganization, all pending and future asbestos-related claims are channeled for resolution to either a personal injury trust (the “PITrust”) or a property damage trust (the “PD Trust”). The trusts are the sole recourse for holders of asbestos-related claims. The channelinginjunctions issued by the bankruptcy court prohibit holders of asbestos-related claims from asserting such claims directly against Grace.

Grace has satisfied all of its financial obligations to the PI Trust. Grace has contingent financial obligations remaining to the PD Trust. Withrespect to property damage claims related to Grace’s former Zonolite attic insulation product (“ZAI PD Claims”), the PD Trust was funded with $49.4million (net of $15 million of attorneys’ fees) to pay claims and expenses. Grace is also obligated to make up to 10 contingent deferred payments of$8 million per year to the PD Trust during the 20-year period beginning on February 3, 2019, with each such payment due only if the assets of thePD Trust in respect of ZAI PD Claims fall below $10 million during the preceding year. As of December 31, 2020, the PD Trust has paid outapproximately $38 million in ZAI PD Claims and expenses, leaving a balance of approximately $18 million, including the benefit of realizedinvestment gains.

Due to the limited claims history, the unique nature of this product, and the uncertainty of future claims patterns, an actuarial analysis wascompleted to estimate the range of possible future payments. The analysis was conducted by a third-party actuarial firm directed by Grace andusing historical claims data provided by the ZAI trustee. Certain key assumptions employed in the analysis were (1) projections of the future numberof filed claims, assuming a percentage increase in claims during earlier years and annual decreases in later years; (2) application of historicalpercentages of claims closed with indemnity payment compared to total closed claims, applied on a regional basis; and (3) application of theaverage claim payout, which reflects the average indemnity cost per claim closing with payment. As a result of the analysis and taking into accountthe relative uncertainty of future claims activity, Grace determined that contingent funding obligations beyond 2025 are not reasonably estimable.Grace estimates that the reasonable range of payments over the period of 2021 to 2025 is expected to be between $16 million and $24 million andprojects that the first payment could be due as early as 2022. In the 2019 fourth quarter, Grace recorded a $24.0 million liability related to probablefuture obligations to fund the PD Trust for ZAI PD Claims. Grace’s maximum financial obligation over the next 18 years is $80.0 million, and nosingle year’s payment can exceed $8.0 million.

With respect to other asbestos property damage claims (“Other PD Claims”), claims unresolved as of the Effective Date are to be litigated inthe bankruptcy court and any future claims are to be litigated in a federal district court, in each case pursuant to procedures approved by thebankruptcy court. To the extent any such Other PD Claims are determined to be allowed claims, they are to be paid in cash by the PD Trust. Graceis obligated to make a payment to the PD Trust every six months in the amount of any Other PD Claims allowed during the preceding six monthsplus interest (if applicable) and the amount of PD Trust expenses for the preceding six months (the “PD Obligation”). Grace has not paid any OtherPD Claims since emergence. Annual expenses have been approximately $0.2 million per year. The aggregate amount to be paid under the PDObligation is not capped, and Grace may be obligated to make additional payments to the PD Trust in respect of the PD Obligation. Grace hasaccrued for those unresolved Other PD Claims that it believes are probable and estimable. Grace has not accrued for other unresolved orunasserted Other PD Claims as it does not believe that payment is probable.

All payments to the PD Trust required after the Effective Date are secured by the Company’s obligation to issue 77,372,257 shares ofCompany common stock to the PD Trust in the event of default, subject to customary anti-dilution provisions.

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10.CommitmentsandContingentLiabilities(Continued)

This summary of the commitments and contingencies related to the Chapter 11 proceeding does not purport to be complete and is qualified inits entirety by reference to the plan of reorganization and the exhibits and documents related thereto, which have been filed with the SEC and arereadily available on the internet at www.sec.gov.

Legacy Environmental Liabilities Grace is subject to loss contingencies resulting from extensive and evolving federal, state, local andforeign environmental laws and regulations relating to its manufacturing operations. Grace has procedures in place to minimize such contingencies;nevertheless, it has liabilities associated with past operations and additional claims may arise in the future, which may be material. To address itslegacy liabilities, Grace accrues for anticipated costs of response efforts where an assessment has indicated that a probable liability has beenincurred and the cost can be reasonably estimated. These accruals do not take into account any discounting for the time value of money.

Grace’s environmental liabilities are reassessed regularly and adjusted when circumstances become better defined or response efforts andtheir costs can be better estimated, typically as a matter moves through the life-cycle of environmental investigation and remediation. Theseliabilities are evaluated based on currently available information relating to the nature and extent of contamination, risk assessments, feasibility ofresponse actions, and apportionment amongst other potentially responsible parties, all evaluated in light of prior experience.

At December 31, 2020, Grace’s estimated liability for legacy environmental response costs totaled $109.2 million, compared with $115.3 millionat December 31, 2019, and was included in “other current liabilities” and “other liabilities” in the Consolidated Balance Sheets. These amounts arebased on agreements in place or on Grace’s estimate of costs where no formal remediation plan or agreement to pay exists, yet there is sufficientinformation to estimate response costs.

Grace recorded pre-tax charges of $1.6 million, $1.7 million, and $73.8 million for legacy environmental matters in 2020, 2019, and 2018,respectively, which is included in “costs related to legacy matters” in the Consolidated Statements of Operations.

Vermiculite-Related Matters

Grace purchased a vermiculite mine in Libby, Montana, in 1963 and operated it until 1990. Vermiculite concentrate from the Libby mine wasused in the manufacture of attic insulation and other products. Some of the vermiculite ore contained naturally occurring asbestos.

Grace is engaged with the U.S. Environmental Protection Agency (the “EPA”) and other federal, state and local governmental agencies in aremedial investigation and feasibility study (“RI/FS”) of the Libby mine and the surrounding area, known as Operable Unit 3 (“OU3”). The RI/FS willstudy the areas within OU3 requiring remediation and will identify possible remedial action alternatives. Possible remedial actions within OU3 arewide-ranging, from institutional controls such as land use restrictions, to more active measures involving soil removal, containment projects, or otherprotective measures.

As part of the RI/FS process, Grace contracted an engineering and consulting firm to develop a range of possible remedial alternatives andassociated cost estimates for OU3. Based on this work, Grace recorded a pre-tax charge of $70.0 million during the three months ended September30, 2018, for the estimated costs of remediation of OU3. Grace believes that this amount should provide for a protective remedy meeting thestatutory requirements of the Comprehensive Environmental Response, Compensation, and Liability Act.

The estimated costs of remediation are preliminary and consist of several components, each of which may vary significantly as the remedialalternatives are further developed. It is reasonably possible that the ultimate costs of remediation could range between $30 million and $170 million.Grace is working closely with the EPA, and the ultimate remedy will be determined by the EPA after the RI/FS is finalized. Such remedy will be setforth in a Record of Decision (“ROD”) that is currently expected to be issued by the EPA no earlier than 2024. Costs associated with the more activeremedial alternatives would be expected to be incurred over a decade or more. Grace will reevaluate its estimated liability as remedial alternativesevolve based on further work by the engineering and consulting firm and discussions with the EPA as the RI/FS process moves toward a ROD.Technical memoranda expected prior to the issuance of the ROD may provide insight into the likely remedial

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alternatives ultimately selected, allowing Grace to update its cost of remediation estimate. Depending on the remedial alternatives that the EPAselects in the ROD, the total cost of remediating OU3 may exceed Grace’s current estimate by material amounts. The amounts set forth above donot include possible liability for natural resources damage. Based on ecological studies conducted by the EPA, Grace does not believe that naturalresources damage has occurred. However, if a party were to be successful in asserting a natural resources damage claim, liability related to suchobligation could be material.

Grace has cooperated with the EPA in investigating and remediating a number of formerly owned or operated sites that processed Libbyvermiculite into finished products. Grace has recorded a liability for remaining expected response costs, including costs for EPA oversight andpotential future site remediation, where a review has indicated that liability is probable and the cost is estimable. The EPA may commence additionalinvestigations in the future at other sites that processed Libby vermiculite. Liability for unaccrued additional investigation and remediation costs isprobable but not yet estimable, and could be material.

Grace recorded pre-tax charges of $0.1 million, $0.0 million, and $70.2 million in 2020, 2019, and 2018, respectively, for future costs related tovermiculite-related matters. Grace’s estimated liability for response costs that are currently estimable for OU3 and vermiculite processing sitesoutside of Libby at December 31, 2020 and 2019, totaled $71.2 million and $76.0 million, respectively. It is possible that Grace’s ultimate liability forthese vermiculite-related matters will exceed current estimates by material amounts.

Non-Vermiculite-Related Environmental Matters

Grace recorded pre-tax charges of $1.5 million, $1.7 million, and $3.6 million to increase non-vermiculite-related environmental reserves in2020, 2019, and 2018, respectively. At December 31, 2020, Grace’s estimated legacy environmental liability for response costs at sites not relatedto its former vermiculite mining and processing activities totaled $38.0 million, compared with $39.3 million at December 31, 2019. This liabilityrelates to Grace’s former businesses or operations, including its share of liability at off-site disposal facilities. Grace’s estimated liability is basedupon regulatory requirements and environmental conditions at each site. As Grace receives new information, its estimated liability may changematerially.

Other Legacy Liabilities Beginning in 1971, as part of implementing a wet milling process at the Libby, Montana, vermiculite mine, Graceconstructed a dam at the mine property that now prevents vermiculite ore tailings from moving into nearby creeks and rivers. Ongoing operation ofthe dam is regulated by the Montana Department of Natural Resources and Conservation (“DNRC”). In April 2019, the DNRC renewed the permitnecessary for operation of the dam. Grace is legally obligated to operate the dam and construct a new spillway in accordance with the latest permitconditions.

Construction of the new dam spillway at the former mine site is a key element of Grace’s overall remediation strategy. The project includesboth an upper spillway and a lower spillway that are being managed as two separate projects with different engineering design and constructiontimelines. In 2019, Grace contracted a third-party engineering and consulting firm to develop an initial range of cost estimates for the total project.Based on this work, Grace recorded a liability of $68.0 million in 2019 for the estimated costs of the project. These costs were preliminary andsubject to change as new information becomes available, including defining the final scope of the projects through the contract bidding process.During the three months ended September 30, 2020, Grace completed a review of contractor bids for the replacement of the upper spillway andincreased its cost estimate for this portion of the project by $27.0 million, bringing the estimate for the total project to $95.0 million. Regarding thelower spillway, final engineering will be completed and submitted to the state of Montana for design approval in 2021, after which Grace will seekcontract bids for this portion of the project. Grace believes it is reasonably possible that the ultimate costs of the two spillway projects could rangebetween $80 million and $120 million. As Grace receives new information, its estimated liability may change materially. Construction will begin in2021 and is expected to take three to four years.

CommercialandFinancialCommitmentsandContingencies

Purchase Commitments Grace uses purchase commitments to ensure supply and to minimize the volatility of major components of directmanufacturing costs including natural gas, certain metals, rare earths, and other materials. Such commitments are for quantities that Grace fullyexpects to use in its normal operations.

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Guarantees and Indemnification Obligations Grace is a party to many contracts containing guarantees and indemnification obligations.These contracts primarily consist of:

• Product warranties with respect to certain products sold to customers in the ordinary course of business. These warranties typicallyprovide that products will conform to specifications. Grace accrues a warranty liability on a transaction-specific basis depending on theindividual facts and circumstances related to each sale.

• Performance guarantees offered to customers under certain licensing arrangements. Grace has not established a liability for thesearrangements based on past performance.

• Licenses of intellectual property by Grace to third parties in which Grace has agreed to indemnify the licensee against third partyinfringement claims.

• Contracts providing for the sale or spin-off of a former business unit or product line in which Grace has agreed to indemnify the buyer orresulting entity against certain liabilities related to activities prior to the closing of the transaction, including environmental, tax, andemployee liabilities.

• Indemnification obligations of Grace as a tenant of real property leases; and guarantees of real property lease obligations of thirdparties, typically arising out of (a) leases entered into by former subsidiaries of Grace, or (b) the assignment or sublease of a lease byGrace to a third party.

Financial Assurances Financial assurances have been established for a variety of purposes, including insurance and environmentalmatters, trade-related commitments and other matters. At December 31, 2020, Grace had gross financial assurances issued and outstanding of$141.1 million, composed of $77.8 million of surety bonds issued by various insurance companies and $63.3 million of standby letters of credit andother financial assurances issued by various banks.

11.RestructuringExpensesandRepositioningExpenses

Restructuring Expenses Restructuring costs in 2020 primarily related to an increase in estimated contractual costs related to a 2018 plantexit. Costs in 2019 primarily related to severance costs pertaining to the idling of our methanol-to-olefins (“MTO”) manufacturing facility, which weresubstantially paid in 2019. Costs in 2018 primarily related to the closure of two small manufacturing plants, the activities from which were moved tolarger, more cost-effective plants as part of Grace’s strategy to capture synergies from catalysts acquisitions. These costs are included in“restructuring and repositioning expenses” in the Consolidated Statements of Operations, and are not included in segment operating income.

The following table presents restructuring expenses by reportable segment for the years ended December 31, 2020, 2019, and 2018.

YearEndedDecember31,(Inmillions) 2020 2019 2018Catalysts Technologies $ 1.8 $ 1.6 $ 13.7 Materials Technologies 0.1 1.0 0.5 Corporate — — (0.2)Totalrestructuringexpenses $ 1.9 $ 2.6 $ 14.0

Substantially all costs related to the restructuring programs are expected to be paid by June 30, 2023, but could be paid earlier subject tonegotiations around certain plant exit costs.

The following table presents components of the change in the restructuring liability for the years ended December 31, 2020, 2019, and 2018:

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11.RestructuringExpensesandRepositioningExpenses(Continued)

(Inmillions) TotalBalance,December31,2017 $ 6.7 Accruals for severance and other costs 10.1 Payments (6.1)Balance,December31,2018 $ 10.7 Accruals for severance and other costs 2.6 Payments (10.2)Currency translation adjustments and other 0.7 Balance,December31,2019 $ 3.8 Accruals for severance and other costs 3.2 Payments (3.1)Balance,December31,2020 $ 3.9

Repositioning Expenses Repositioning expenses for the years ended December 31, 2020, 2019, and 2018 were $35.0 million, $11.1million, and $32.4 million respectively.

During 2020, Grace implemented changes to its Refining Technologies manufacturing operations and global footprint to drive capital andoperating efficiencies and to support global growth. Grace, in agreement with its local joint venture partner, discontinued the previously announcedproject to build a full-scale fluid catalytic cracking catalysts plant in the Middle East. As a result, repositioning expenses in 2020 included a charge of$19.7 million to write off engineering and site costs. Repositioning expenses in 2020 also included $7.2 million in costs related to our review ofstrategic alternatives.

In 2020, 2019, and 2018, Grace incurred expenses related to a multi-year program to transform manufacturing and business processes toextend Grace’s competitive advantages and improve its cost position. Expenses in 2018 also included $11.7 million of severance and stockcompensation costs related to employee separations and write-offs of $8.5 million of previously capitalized plant engineering costs as a result ofterminating a manufacturing plant expansion project no longer necessary due to the polyolefin catalysts acquisition (see Note 20). Excluding assetwrite-offs and stock compensation costs, substantially all of these costs have been or are expected to be settled in cash.

12.Other(Income)Expense,net

Components of other (income) expense, net are as follows:

YearEndedDecember31,(Inmillions) 2020 2019 2018Defined benefit pension (income) expense other than service cost $ 79.5 $ 79.9 $ (27.8)Business interruption insurance recoveries (16.3) (10.7) — Hurricane-related costs 13.2 — — Net (gain) loss on sales of investments and disposals of assets 5.9 4.5 4.9 Third-party acquisition-related costs 5.2 3.6 7.3 Currency transaction effects (0.1) (0.8) (3.6)Other miscellaneous (income) expense 1.6 4.1 (4.0)Totalother(income)expense,net $ 89.0 $ 80.6 $ (23.2)

During 2020, Hurricane Laura caused severe and widespread damage to Lake Charles, Louisiana, and surrounding communities, includingcatastrophic damage to the regional power grid. The hurricane-related costs were primarily due to on-site power generation, incremental operationsand logistics costs to supply customers during the outage, temporary housing and employee assistance, and property damage and clean-up. Inaddition

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12.Other(Income)Expense,net(Continued)

to the amount shown above, Grace’s equity in earnings from unconsolidated affiliate was reduced by $1.9 million due to hurricane-related costsincurred by the joint venture.

In July 2019, a North American FCC catalysts customer filed for bankruptcy protection after announcing it would not resume refinery operationsfollowing a fire in its refinery. Grace received $16.3 million during the six months ended June 30, 2020, under its business interruption insurancepolicy. Including the $8.0 million received in the 2019 fourth quarter, Grace received $24.3 million of insurance recoveries related to this event,reflecting approximately eight quarters of the impact of the incident on earnings. This claim has been fully resolved.

13.OtherComprehensiveIncome(Loss)

The following tables present the pre-tax, tax, and after-tax components of Grace’s other comprehensive income (loss) for the years endedDecember 31, 2020, 2019, and 2018:

YearEndedDecember31,2020(Inmillions) Pre-TaxAmount

TaxBenefit/(Expense)

After-TaxAmount

Amortization of net prior service credit included in net periodic benefit cost and other costs (credits), net $ (0.5) $ 0.1 $ (0.4)Currency translation adjustments (53.6) 3.7 (49.9)Gain (loss) from hedging activities 1.6 (0.8) 0.8 Othercomprehensiveincome(loss)attributabletoW.R.Grace&Co.shareholders $ (52.5) $ 3.0 $ (49.5)



After-TaxAmount

Amortization of net prior service credit included in net periodic benefit cost and other costs (credits), net $ (0.9) $ 0.2 $ (0.7)Currency translation adjustments 18.5 (2.0) 16.5 Gain (loss) from hedging activities (7.0) 2.1 (4.9)Othercomprehensiveincome(loss)attributabletoW.R.Grace&Co.shareholders $ 10.6 $ 0.3 $ 10.9



After-TaxAmount

Amortization of net prior service credit included in net periodic benefit cost and other costs (credits), net $ (1.2) $ 0.3 $ (0.9)Currency translation adjustments 34.6 (2.2) 32.4 Gain (loss) from hedging activities (10.0) 4.3 (5.7)Othercomprehensiveincome(loss)attributabletoW.R.Grace&Co.shareholders $ 23.4 $ 2.4 $ 25.8

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13.OtherComprehensiveIncome(Loss)(Continued)

The following table presents the changes in accumulated other comprehensive income (loss), net of tax, for the years ended December 31,2020, 2019, and 2018:

DefinedBenefitPensionandOtherPostretirementPlans

CurrencyTranslationAdjustments

Gain(Loss)fromHedgingActivities Total

Balance,December31,2017 $ 0.9 $ 41.6 $ (2.6) $ 39.9 OCI before reclassifications — 32.4 11.1 43.5 Amounts reclassified from accumulated OCI (0.9) — (16.8) (17.7)

Net current-period other comprehensive income (loss) (0.9) 32.4 (5.7) 25.8 Effect of adopting ASU 2018-02 0.2 2.2 (0.2) 2.2 Balance,December31,2018 $ 0.2 $ 76.2 $ (8.5) $ 67.9

OCI before reclassifications — 16.5 14.0 30.5 Amounts reclassified from accumulated OCI (0.7) — (18.9) (19.6)

Net current-period other comprehensive income (loss) (0.7) 16.5 (4.9) 10.9 Balance,December31,2019 $ (0.5) $ 92.7 $ (13.4) $ 78.8

OCI before reclassifications — (49.9) (33.7) (83.6)Amounts reclassified from accumulated OCI (0.4) — 34.5 34.1

Net current-period other comprehensive income (loss) (0.4) (49.9) 0.8 (49.5)Balance,December31,2020 $ (0.9) $ 42.8 $ (12.6) $ 29.3

Grace is a global enterprise operating in many countries with local currency generally deemed to be the functional currency for accountingpurposes. The currency translation amount represents the adjustments necessary to translate the balance sheets valued in local currencies to theU.S. dollar as of the end of each period presented, and to translate revenues and expenses at average exchange rates for each period presented,as well as amounts related to net investment hedges. See Note 6 for a discussion of hedging activities. See Note 8 for a discussion of pensionplans.

14.Shareholders’Equity

Under its Amended and Restated Certificate of Incorporation, the Company is authorized to issue 300,000,000 shares of common stock, $0.01par value per share. As of December 31, 2020, the W. R. Grace & Co. 2018 Stock Incentive Plan (together with the 2014 Stock Incentive Plan,collectively, the “Stock Incentive Plans”) had 6,474,722 shares of unissued stock reserved for issuance in the event of the exercise of stock optionsor the issuance or settlement of stock-based compensation or awards. Shares issuable upon the exercise of stock options or the issuance orsettlement of stock-based compensation or awards are covered by reissuing treasury stock, to the extent available; otherwise they are coveredthrough newly issued shares. In 2020, 15,960 common shares were issued to members of the Board of Directors, in partial payment of their annualretainer, and 112,344 shares were issued to settle vested PBUs and vested tranches of RSUs.

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14.Shareholders’Equity(Continued)

The following table sets forth information relating to common stock activity for the years ended December 31, 2020, 2019, and 2018:

(Inmillions,exceptshares) NumberofSharesAggregateProceeds

Balanceofoutstandingshares,December31,2017 67,780,410 Stock options exercised 243,502 $ 6.7 Shares issued 72,590 Shares forfeited through net share exercise (132,393)Shares repurchased (1,171,141)Balanceofoutstandingshares,December31,2018 66,792,968 Stock options exercised 388,174 $ 19.1 Shares issued 94,796 Shares forfeited through net share exercise (130,256)Shares repurchased (409,769)Balanceofoutstandingshares,December31,2019 66,735,913 Stock options exercised — $ — Shares issued 128,304 Shares repurchased (673,807)Balanceofoutstandingshares,December31,2020 66,190,410

15.StockIncentivePlans

The Stock Incentive Plans are administered by the Compensation Committee of the Board of Directors. Pursuant to the Stock Incentive Plans,the Company maintains Long-term Incentive Plans (the “LTIP”) under which it issues RSUs, PBUs, and stock options.

The Company has granted nonstatutory stock options to certain key employees under the Stock Incentive Plans. Stock options are generallynon-qualified and are at exercise prices not less than 100% of the average per share fair market value on the date of grant. Stock-basedcompensation awards granted under the Company’s stock incentive plans are generally subject to a vesting period from the date of the grantranging from 1 - 3 years. Currently outstanding options expire on various dates through May 2030.

On May 9, 2018, the Company’s stockholders approved the W. R. Grace & Co. 2018 Stock Incentive Plan. Under this new plan, stock optionshave a 10-year life. The Company began issuing stock-based compensation awards from this plan in the second half of 2018. The Company’s priorgrants were issued under the previous plan in which options have a 5-year life.

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15.StockIncentivePlans(Continued)

The following table sets forth information relating to such options during 2020, 2019, and 2018.

NumberofShares

AverageExercisePrice

Weighted-AverageGrantDateFairValue

Balance,December31,2017 1,813,450 $ 72.04 Options exercised (243,502) 61.92 Options forfeited (90,862) 69.82 Options terminated (33,481) 75.07 Options granted 428,190 67.36 $ 12.30 Balance,December31,2018 1,873,795 72.34 Options exercised (388,174) 74.33 Options forfeited (35,216) 71.21 Options terminated (74,583) 77.30 Options granted 189,787 78.11 $ 17.94 Balance,December31,2019 1,565,609 72.30 Options exercised — — Options forfeited (26,696) 60.26 Options terminated (473,582) 76.67 Options granted 348,005 55.34 $ 9.64 Balance,December31,2020 1,413,336 66.89

The following is a summary of nonvested option activity for the year ended December 31, 2020.

NumberOfShares

Weighted-AverageGrantDateFairValue

Nonvested options outstanding at beginning of year 506,593 $ 14.81 Granted 348,005 9.64 Vested (269,148) 13.93 Forfeited (20,787) 9.90 Nonvestedoptionsoutstandingatendofyear 564,663 12.16

As of December 31, 2020, the intrinsic value (the difference between the exercise price and the market price) for options outstanding wasimmaterial and for options exercisable was zero. The total intrinsic value of all options exercised during the years ended December 31, 2019 and2018 was $0.8 million and $1.6 million, respectively. No options were exercised in 2020. A summary of our stock options outstanding andexercisable at December 31, 2020, follows:

ExercisePriceRange NumberOutstanding NumberExercisable

OutstandingWeighted-AverageRemaining

ContractualLife(Years)

ExercisableWeighted-AverageExercisePrice

$40 - $50 1,802 — 9.35 $ — $50 - $60 326,051 — 9.17 — $60 - $70 640,777 522,178 1.31 67.92 $70 - $80 444,706 326,495 3.90 72.65

1,413,336 848,673

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At December 31, 2020, the weighted-average remaining contractual term of all options outstanding and exercisable was 3.95 years.

Options Granted For the years ended December 31, 2020, 2019, and 2018, the Company recognized non-cash stock-based compensationexpense with respect to stock option grants of $2.8 million, $3.1 million, and $5.8 million, respectively, which is included in “selling, general andadministrative expenses” in the Consolidated Statements of Operations. The actual tax benefit realized from stock option arrangements totaled $0.6million, $1.9 million, and $2.2 million for the years ended December 31, 2020, 2019 and 2018, respectively.

The Company values options using the Black-Scholes option-pricing model, which was developed for use in estimating the fair value of tradedoptions. The risk-free rate is based on the U.S. Treasury yield curve published as of the grant date, with maturities approximating the expected termof the options. The expected term of the options is estimated using the simplified method as allowed by ASC 718-20, whereby the average betweenthe vesting period and contractual term is used. The expected volatility was estimated using actual Company stock volatility. The followingsummarizes the weighted average assumptions used for estimating the fair value of stock options granted during 2020, 2019, and 2018,respectively.

2020 2019 2018Expected volatility 22.7%-29.4% 22.7% - 23.1% 22.9% - 24.4%Weighted average expected volatility 22.9% 23.0% 23.7%Expected term 5.5-6.5years 5.5 - 6.5 years 3.0 - 6.5 yearsRisk-free rate 1.18% 2.58% 2.55%Dividend yield 2.2% 1.4% 1.4%

Total unrecognized stock-based compensation expense at December 31, 2020, was $2.1 million, and the weighted-average period over whichthis expense will be recognized is 0.8 of a year.

Restricted Stock and Performance Based Units In 2019, the Company modified a majority of its 2017 and 2018 cash-settled LTIP awardsto be stock-settled. The following is a summary of RSUs and PBUs awarded under the LTIP.

2020 2019 2018PBUs granted under the LTIP 120,161 88,174 93,216RSUs granted under the LTIP 68,658 57,900 86,698Shares covered by awards forfeited under the LTIP 17,250 17,323 44,279Weighted average grant date fair value of PBUs $55.33 $78.11 $67.39Weighted average grant date fair value of RSUs $55.05 $76.91 $67.54Approximate percentage of awards expected to settle in common stock(1) 96 % 96 % 94 %Approximate percentage of awards expected to settle in cash(1) 4 % 4 % 6 %___________________________________________________________________________________________________________________

(1) Assumes full vesting.

The PBUs cliff vest after the completion of the performance periods ending December 31, 2022, 2021, and 2020. The RSUs vest in three equalannual installments. Vesting for all awards is subject to continued employment through the payment date (subject to certain exceptions forretirement, death or disability, change in control scenarios, and in the discretion of the Compensation Committee).

PBUs and RSUs are recorded at fair value at the date of grant. The common stock settled portion is considered an equity award with thepayout being valued based on the Company’s stock price on the grant date. The cash settled portion of the award is considered a liability award withpayout being remeasured each reporting period based on the Company’s current stock price. PBU equity awards are remeasured each reportingperiod based on the expected payout of the award, which may range from 0% to 200% of the targets for such awards; therefore, these portions ofthe awards are subject to volatility until the payout is finally determined at the end of

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the performance period. During 2020, 2019, and 2018, the Company recognized $8.0 million, $9.2 million, and $13.2 million in compensationexpense for these awards. As of December 31, 2020, $11.0 million of total unrecognized compensation expense related to the awards is expectedto be recognized over the remaining weighted-average service period of 0.9 years.

16.EarningsPerShare

The following table shows a reconciliation of the numerators and denominators used in calculating basic and diluted earnings per share.

YearEndedDecember31,(Inmillions,exceptpershareamounts) 2020 2019 2018NumeratorsNet income (loss) attributable to W. R. Grace & Co. shareholders $ (1.8) $ 126.3 $ 167.6

DenominatorsWeighted average common shares—basic calculation 66.3 66.8 67.2 Dilutive effect of employee stock options — 0.1 0.1Weighted average common shares—diluted calculation 66.3 66.9 67.3

Basicearningspershare $ (0.03) $ 1.89 $ 2.49 Dilutedearningspershare $ (0.03) $ 1.89 $ 2.49

There were approximately 1.6 million, 1.0 million and 1.7 million anti-dilutive options outstanding for the years ended December 31, 2020,2019, and 2018, respectively.

On February 8, 2017, the Company announced that its Board of Directors had authorized a share repurchase program of up to $250 million.On February 28, 2020, Grace announced that its Board of Directors had increased its share repurchase authorization to $250 million, includingapproximately $83 million remaining under the previously announced program. The timing of the repurchases and the actual amount repurchasedwill depend on a variety of factors, including the market price of the Company’s shares, strategic priorities for the deployment of capital, and generalmarket and economic conditions. During 2020, 2019, and 2018, the Company repurchased 673,807; 409,769; and 1,171,141 shares of Companycommon stock for $40.4 million, $29.8 million, and $80.0 million, respectively, pursuant to the terms of the share repurchase program. As ofDecember 31, 2020, $235.0 million remained under the current authorization.

17.Revenues

Grace generates revenues from customer arrangements primarily by manufacturing and delivering specialty chemicals and specialty materials,and by licensing technology, through its two reportable segments. See Note 18 for additional information about Grace’s reportable segments.

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17.Revenues(Continued)

Disaggregation of Revenue The following tables present Grace’s revenues by geography and product group, within its respectivereportable segments, for the years ended December 31, 2020, 2019, and 2018.

YearEndedDecember31,2020(Inmillions) NorthAmerica

EuropeMiddleEastAfrica(EMEA) AsiaPacific LatinAmerica Total

Polyolefin and Chemical Catalysts $ 172.3 $ 231.7 $ 201.1 $ 16.5 $ 621.6 Refining Catalysts 216.6 279.1 120.4 33.7 649.8 TotalCatalystsTechnologies $ 388.9 $ 510.8 $ 321.5 $ 50.2 $ 1,271.4 Pharma/Consumer $ 61.5 $ 60.9 $ 19.8 $ 20.3 $ 162.5 Coatings 25.4 66.6 35.8 9.7 137.5 Chemical process 28.5 69.4 36.1 6.6 140.6 Other 4.1 13.3 0.3 0.1 17.8 TotalMaterialsTechnologies $ 119.5 $ 210.2 $ 92.0 $ 36.7 $ 458.4 TotalGrace $ 508.4 $ 721.0 $ 413.5 $ 86.9 $ 1,729.8

YearEndedDecember31,2019(Inmillions) NorthAmerica EMEA AsiaPacific LatinAmerica TotalPolyolefin and Chemical Catalysts $ 191.4 $ 283.0 $ 213.7 $ 17.2 $ 705.3 Refining Catalysts 291.4 288.4 171.7 39.9 791.4 TotalCatalystsTechnologies $ 482.8 $ 571.4 $ 385.4 $ 57.1 $ 1,496.7 Pharma/Consumer $ 45.2 $ 59.1 $ 20.1 $ 20.2 $ 144.6 Coatings 25.9 67.8 36.9 9.2 139.8 Chemical process 38.1 79.1 32.3 6.6 156.1 Other 5.8 14.2 0.7 0.2 20.9 TotalMaterialsTechnologies $ 115.0 $ 220.2 $ 90.0 $ 36.2 $ 461.4 TotalGrace $ 597.8 $ 791.6 $ 475.4 $ 93.3 $ 1,958.1

YearEndedDecember31,2018(Inmillions) NorthAmerica EMEA AsiaPacific LatinAmerica TotalPolyolefin and Chemical Catalysts $ 192.6 $ 255.4 $ 193.2 $ 20.3 $ 661.5 Refining Catalysts 282.8 266.0 193.4 59.8 802.0 TotalCatalystsTechnologies $ 475.4 $ 521.4 $ 386.6 $ 80.1 $ 1,463.5 Pharma/Consumer $ 36.2 $ 58.0 $ 19.0 $ 19.4 $ 132.6 Coatings 28.1 75.3 43.3 8.7 155.4 Chemical process 35.2 81.6 32.2 8.3 157.3 Other 6.8 15.9 0.4 0.2 23.3 TotalMaterialsTechnologies $ 106.3 $ 230.8 $ 94.9 $ 36.6 $ 468.6 TotalGrace $ 581.7 $ 752.2 $ 481.5 $ 116.7 $ 1,932.1

Contract Balances Grace invoices customers for product sales once performance obligations have been satisfied, generally at the point ofdelivery, at which point payment becomes unconditional. Accordingly, Grace’s product sales contracts generally do not give rise to material contractassets or liabilities under ASC 606; however, from time to time certain customers may pay in advance, which results in a contract liability. In thetechnology licensing business, Grace typically invoices licensees at the time that contractual milestones are achieved. However, in respect of themilestone billings, Grace is frequently obligated to provide services in future periods, and this results in recording contract liabilities.

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17.Revenues(Continued)

The following table presents Grace’s deferred revenue balances as of December 31, 2020 and 2019:

December31,(Inmillions) 2020 2019Current $ 33.8 $ 35.0 Noncurrent 23.4 29.5 Total $ 57.2 $ 64.5

Grace records deferred revenues when cash payments are received or due in advance of performance. The change in deferred revenuereflects cash payments from customers received or due in advance of satisfying performance obligations, offset by $31.0 million of revenuerecognized that was included in the deferred revenue balance as of December 31, 2019.

The noncurrent portion of deferred revenue will be recognized as performance obligations under the technology licensing agreements aresatisfied, which is expected to be over the next four years.

Remaining performance obligations represent the estimated revenue expected to be recognized in the future related to performanceobligations that are unsatisfied (or partially unsatisfied). The aggregate amount of the transaction price allocated to remaining performanceobligations for such contracts with a duration of more than one year was approximately $148 million as of December 31, 2020, and includes certainamounts reported as deferred revenue above. In accordance with the available practical expedient, Grace does not disclose informationabout remaining performance obligations that have original expected durations of one year or less, which generally relate to customer prepaymentson product sales and are generally satisfied in less than one year. Grace expects to recognize revenue related to remaining performance obligationsover several years, as follows:

YearApproximatepercentageofrevenuerelatedtoremainingperformance

obligationsrecognized2021 27 %2022 19 %2023 17 %2024 16 %Thereafter through 2030 21 %

For the years ended December 31, 2020, 2019, and 2018, revenue recognized from performance obligations related to prior periods was notmaterial. Grace has not capitalized any costs to obtain or fulfill contracts with customers under ASC 606. No material impairment losses have beenrecognized on any receivables or contract assets arising from contracts with customers.

18.SegmentInformation

Grace is a global producer of specialty chemicals and specialty materials. Grace’s two reportable business segments are Grace CatalystsTechnologies and Grace Materials Technologies. Grace Catalysts Technologies includes catalysts and related products and technologies used inpetrochemical, refining, and other chemical manufacturing applications. Advanced Refining Technologies (“ART”), Grace’s joint venture withChevron U.S.A. Inc. (“Chevron”), is managed in this segment. (See Note 19.) Grace Catalysts Technologies comprises two operating segments,Grace Specialty Catalysts and Grace Refining Technologies, which are aggregated into one reportable segment based upon similar economiccharacteristics, the nature of the products and production processes, type and class of customer, and channels of distribution. Grace MaterialsTechnologies includes specialty materials, including silica-based and silica-alumina-based materials, used in pharma/consumer, coatings, andchemical process applications. The table below presents information related to Grace’s reportable segments. Only those corporate expensesdirectly related to the reportable segments are allocated for reporting purposes. All remaining corporate items are reported separately and labeledas such.

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18.SegmentInformation(Continued)

Grace excludes defined benefit pension expense from the calculation of segment operating income. Grace believes that the exclusion ofdefined benefit pension expense provides a better indicator of its reportable segment performance as defined benefit pension expense is notmanaged at a reportable segment level.

Grace defines Adjusted EBIT to be net income attributable to W. R. Grace & Co. shareholders adjusted for interest income and expense;income taxes; costs related to legacy matters; restructuring and repositioning expenses and asset impairments; pension costs other than serviceand interest costs, expected returns on plan assets, and amortization of prior service costs/credits; gains and losses on sales or exits of businesses,product lines, and certain other investments; third-party acquisition-related costs and the amortization of acquired inventory fair value adjustment;gains and losses on modification or extinguishment of debt; the effects of these items on equity in earnings of unconsolidated affiliate; and certainother items that are not representative of underlying trends.

ReportableSegmentData YearEndedDecember31,

(Inmillions) 2020 2019 2018NetSalesCatalysts Technologies $ 1,271.4 $ 1,496.7 $ 1,463.5 Materials Technologies 458.4 461.4 468.6 Total $ 1,729.8 $ 1,958.1 $ 1,932.1 AdjustedEBIT Catalysts Technologies segment operating income $ 309.6 $ 466.4 $ 440.9 Materials Technologies segment operating income 85.0 97.8 105.6 Corporate costs (68.0) (72.7) (73.5)Certain pension costs (14.4) (18.4) (15.9)Total $ 312.2 $ 473.1 $ 457.1 DepreciationandAmortizationCatalysts Technologies $ 85.3 $ 81.9 $ 81.7 Materials Technologies 15.0 14.2 15.5 Corporate 4.7 4.2 3.6 Total $ 105.0 $ 100.3 $ 100.8 CapitalExpendituresCatalysts Technologies $ 107.8 $ 114.6 $ 150.3 Materials Technologies 36.2 68.8 56.1 Corporate 13.6 10.7 9.9 Total $ 157.6 $ 194.1 $ 216.3 TotalAssetsCatalysts Technologies $ 2,294.9 $ 2,556.1 $ 2,326.6 Materials Technologies 448.2 430.3 375.9 Corporate 1,022.4 946.2 862.8 Total $ 3,765.5 $ 3,932.6 $ 3,565.3

Corporate costs include functional costs and other costs such as professional fees, incentive compensation, and insurance premiums. Certainpension costs include only ongoing costs recognized quarterly, which include service and interest costs, expected returns on plan assets, andamortization of prior service costs/credits.

See Note 17 for sales of similar products within each reportable segment.

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ReconciliationofReportableSegmentDatatoFinancialStatements

Grace Adjusted EBIT for the years ended December 31, 2020, 2019, and 2018 is reconciled below to income (loss) before income taxespresented in the accompanying Consolidated Statements of Operations.

YearEndedDecember31,(Inmillions) 2020 2019 2018GraceAdjustedEBIT $ 312.2 $ 473.1 $ 457.1 Pension MTM adjustment and other related costs, net (94.6) (85.9) 15.2 Loss on early extinguishment of debt (39.4) — (4.8)Costs related to legacy product, environmental and other claims (39.4) (103.5) (82.3)Restructuring and repositioning expenses (36.9) (13.7) (46.4)Inventory write-offs and disposal costs(1) (20.7) (3.6) — Third-party acquisition-related costs (5.2) (3.6) (7.3)Taxes and interest included in equity in earnings of unconsolidated affiliate (0.7) 0.1 (0.4)Benefit plan adjustment — (5.0) — Amortization of acquired inventory fair value adjustment — — (6.9)Interest expense, net (74.9) (74.8) (78.5)Net income (loss) attributable to noncontrolling interests 0.1 0.4 (0.8)Income(loss)beforeincometaxes $ 0.5 $ 183.5 $ 244.9 ___________________________________________________________________________________________________________________

(1) Inventory write-off in 2020 related to the changes in hydroprocessing catalysts manufacturing operations (see Note 2). Inventory write-off in 2019related to the idling of Grace’s MTO manufacturing facility.

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GeographicAreaData

The table below presents information related to the geographic areas in which Grace operates. Sales are attributed to geographic areas basedon the location to which the product is transported.

YearEndedDecember31,(Inmillions) 2020 2019 2018NetSalesUnited States $ 459.8 $ 540.2 $ 533.8 Canada 48.6 57.6 47.9 Total North America 508.4 597.8 581.7

Europe Middle East Africa 721.0 791.6 752.2 Asia Pacific 413.5 475.4 481.5 Latin America 86.9 93.3 116.7 Total $ 1,729.8 $ 1,958.1 $ 1,932.1 Long-LivedAssets(1)United States $ 799.1 $ 937.9 $ 793.0 Canada 23.2 18.9 16.5 Total North America 822.3 956.8 809.5

Germany 267.4 228.2 172.5 Rest of Europe Middle East Africa 41.0 45.2 48.9 Total Europe Middle East Africa 308.4 273.4 221.4

Asia Pacific 72.2 80.3 72.9 Latin America 5.9 7.2 6.7 Total $ 1,208.8 $ 1,317.7 $ 1,110.5 ___________________________________________________________________________________________________________________

(1) Long-lived assets as of December 31, 2019 and 2018, include properties and equipment and the current asset related to a hydroprocessing catalystplant to be transferred to ART upon completion. (See Note 19.)

19.RelatedPartyTransactions

Unconsolidated Affiliate Grace accounts for its 50% ownership interest in ART, its joint venture with Chevron, using the equity method ofaccounting. Grace’s investment in ART amounted to $175.5 million and $181.9 million as of December 31, 2020 and 2019, respectively. ART is aprivate, limited liability company, taxed as a partnership, and accordingly does not have a quoted market price available. During 2020, Gracereceived dividends of $20.0 million from ART.

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19.RelatedPartyTransactions(Continued)

The table below presents the components of Grace’s “equity in earnings of unconsolidated affiliate” in the Consolidated Statements ofOperations.

YearEndedDecember31,(Inmillions) 2020 2019 2018Operating income $ 17.5 $ 28.2 $ 32.7 Depreciation and amortization (3.3) (0.5) (0.5)Interest expense and income taxes (0.7) 0.1 (0.4)Equity in earnings of unconsolidated affiliate 13.5 27.8 31.8

The table below presents summary financial data related to ART’s balance sheet and results of operations.

December31,(Inmillions) 2020 2019SummaryBalanceSheetinformation:Current assets $ 286.4 $ 300.7 Noncurrent assets 235.8 237.8 Totalassets $ 522.2 $ 538.5

Current liabilities $ 173.0 $ 177.1 Noncurrent liabilities 0.3 0.3 Totalliabilities $ 173.3 $ 177.4

YearEndedDecember31,(Inmillions) 2020 2019 2018SummaryStatementofOperationsinformation:Net sales $ 481.9 $ 527.5 $ 487.5 Costs and expenses applicable to net sales 431.4 453.4 410.6 Income before income taxes 28.2 59.0 65.5 Net income 27.0 56.5 64.2

Grace and ART transact business on a regular basis and maintain several agreements in order to operate the joint venture. These agreementsand the resulting transactions are treated as related party activities with an unconsolidated affiliate. Product manufactured by Grace for ART isaccounted for on a net basis, with a mark-up, which reduces “cost of goods sold” in the Consolidated Statements of Operations. Grace also receivesreimbursement from ART for fixed costs; research and development; selling, general and administrative services; and depreciation. Grace recordsreimbursements against the respective line items in Grace’s Consolidated Statements of Operations. The table below presents summary financialdata related to transactions between Grace and ART.

YearEndedDecember31,(Inmillions) 2020 2019 2018Product manufactured for ART $ 261.1 $ 260.8 $ 229.1 Mark-up on product manufactured for ART included as a reduction of Grace’s cost of goods sold 5.1 5.1 4.5 Charges for fixed costs; research and development; selling, general and administrative services; and

depreciation to ART 54.3 51.1 41.8

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19.RelatedPartyTransactions(Continued)

The table below presents balances in Grace’s Consolidated Financial Statements related to ART.

December31,(inmillions) 2020 2019Trade accounts receivable $ 28.3 $ 17.5 Other current assets — 173.9 Accounts payable 19.8 37.7 Debt payable within one year 3.5 9.9 Debt payable after one year 22.1 37.5 Other current liabilities — 173.9

The current asset and current liability as of December 31, 2019, in the table above represented spending related to a residue hydroprocessingcatalyst production plant that has been constructed in Lake Charles, Louisiana. Grace managed the design and construction of the plant, and theasset was included in “other current assets” in Grace’s Consolidated Balance Sheets until commissioning and start-up activities were completed.Grace had likewise recorded a liability for the transfer of the asset to ART upon completion, included in “other current liabilities” in the ConsolidatedBalance Sheets. Grace transferred the asset to ART in the 2020 third quarter.

Grace and ART maintain an agreement whereby ART loans Grace funds for maintenance capital expenditures at manufacturing facilities usedto produce catalysts for ART. Grace makes principal and interest payments on the loans on a monthly basis. These unsecured loans haverepayment terms of up to 8 years, unless earlier repayment is demanded by ART. The loans bear interest at the three-month LIBOR plus 1.25%.

Grace and Chevron provide lines of credit in the amount of $15.0 million each at a commitment fee of 0.1% of the credit amount. Theseagreements have been approved by the ART Executive Committee for renewal until February 2022. No amounts were outstanding at December 31,2020 and 2019.

Joint Venture Arrangement In 2018, Grace formed a joint venture in a developing country in Asia. The purpose of the joint venture is toestablish a logistics facility and catalyst testing laboratory and to be the exclusive FCC catalysts and additives supplier to certain customers in thecountry. Grace’s joint venture partner is the parent company of the customers. Grace has an 87.5% ownership interest in the joint venture andconsolidates the activities of the entity. Grace’s Consolidated Balance Sheets as of December 31, 2020 and 2019, include trade accounts receivableof $2.2 million and $3.6 million, respectively, from these customers. Grace’s Consolidated Statements of Operations for the years endedDecember 31, 2020, 2019, and 2018, include $11.3 million, $11.8 million, and $14.0 million, respectively, of revenues from these customers.

20.Acquisitions

Rive Technology, Inc. On June 17, 2019, Grace completed the acquisition of the business and assets of Rive Technology, Inc. for $22.8million, with an additional $2.0 million holdback payment remitted in the three months ended September 30, 2020. The business is included in theRefining Technologies operating segment of the Catalysts Technologies reportable segment. The acquisition included Rive’s MOLECULARHIGHWAY zeolite technology for catalytic processes, which allows Grace to offer a broader spectrum of products for converting crude oil topetrochemical feedstocks.

Polyolefin catalysts business of Albemarle CorporationOn April 3, 2018, using cash on hand and borrowings under the Credit Agreement,Grace acquired the assets of the polyolefin catalysts business of Albemarle Corporation. Grace acquired the business for $418.0 million, net of cashacquired and including customary post-closing adjustments. The business is included in the Specialty Catalysts operating segment of the CatalystsTechnologies reportable segment. The acquisition is complementary to Grace’s existing specialty catalysts business and strengthens Grace’scommercial relationships, catalysts technology portfolio, and manufacturing network.

®

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21.QuarterlyFinancialInformation(Unaudited)

(Inmillions,exceptpershareamounts) March31 June30 September30(2) December31(3)2020Net sales $ 421.5 $ 418.7 $ 419.4 $ 470.2 Gross profit 159.6 119.3 156.4 181.2 Net income (loss) 42.1 (9.6) 6.7 (40.9)Net income (loss) attributable to W. R. Grace & Co. shareholders 42.0 (7.3) 7.0 (43.5)Netincome(loss)pershare:(1)Basic earnings (loss) per share: $ 0.63 $ (0.11) $ 0.11 $ (0.66)Diluted earnings (loss) per share: 0.63 (0.11) 0.11 (0.66)

Dividends declared per share 0.30 0.30 0.30 0.30 ___________________________________________________________________________________________________________________

(1) Per share results for the four quarters may differ from full-year per share results, as a separate computation of the weighted average number of sharesoutstanding is made for each quarter presented.

(2) Third quarter “net income (loss),” “net income (loss) attributable to W. R. Grace & Co. shareholders,” and the related earnings per share data includethe effects of a pre-tax charge of $27.0 million for estimated costs to construct a new dam spillway at the former vermiculite mine site in Libby,Montana, as well as a $39.4 million loss on early extinguishment of debt.

(3) Fourth quarter “net income (loss),” “net income (loss) attributable to W. R. Grace & Co. shareholders,” and the related earnings per share data includethe effects of the annual pension mark-to-market adjustment, as well as charges related to legacy items (see Note 10).

(Inmillions,exceptpershareamounts) March31(2) June30 September30 December31(3)2019Net sales $ 469.5 $ 513.6 $ 470.5 $ 504.5 Gross profit 188.6 209.4 191.0 204.7 Net income (loss) 24.6 76.4 53.8 (28.1)Net income (loss) attributable to W. R. Grace & Co. shareholders 24.7 76.2 53.7 (28.3)Netincome(loss)pershare:(1)Basic earnings (loss) per share: $ 0.37 $ 1.14 $ 0.81 $ (0.42)Diluted earnings (loss) per share: 0.37 1.14 0.80 (0.42)

Dividends declared per share 0.27 0.27 0.27 0.27 ___________________________________________________________________________________________________________________

(1) Per share results for the four quarters may differ from full-year per share results, as a separate computation of the weighted average number of sharesoutstanding is made for each quarter presented.

(2) First quarter “net income (loss),” “net income (loss) attributable to W. R. Grace & Co. shareholders,” and the related earnings per share data include theeffects of a pre-tax charge of $45.0 million for estimated costs to construct a new dam spillway at the former vermiculite mine site in Libby, Montana.

(3) Fourth quarter “net income (loss),” “net income (loss) attributable to W. R. Grace & Co. shareholders,” and the related earnings per share data includethe effects of the annual pension mark-to-market adjustment, as well as charges related to legacy items (see Note 10).

22.SubsequentEvent

On February 25, 2021, Grace entered into a definitive agreement to acquire the Fine Chemistry Services business of Albemarle Corporation(“Albemarle”) for approximately $570 million, including $300 million to be paid in cash at closing and $270 million to be funded through the issuanceto Albemarle of non-participating preferred equity of a newly created wholly owned Grace subsidiary. The cash portion of the transaction is expectedto be funded through a combination of debt and cash on hand. This acquisition would strengthen and expand Grace’s existing pharma portfolio,within the Materials Technologies segment. The transaction is subject to customary closing conditions, including receipt of certain regulatoryapprovals.

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W.R.GRACE&CO.ANDSUBSIDIARIESFINANCIALSTATEMENTSCHEDULEII—VALUATIONANDQUALIFYINGACCOUNTS

FortheYearEndedDecember31,2020

(Inmillions)

Balanceatbeginningof

period

Additionschargedtocostsandexpenses Deductions

Other,net(1)

Balanceatendofperiod

Valuationandqualifyingaccountsdeductedfromassets:Allowances for notes and accounts receivable $ 13.7 $ 0.6 $ (12.1) $ 0.1 $ 2.3 Valuation allowance for deferred tax assets(2) 24.1 15.5 (0.9) — 38.7


(Inmillions)


period


Other,net(1)


Valuationandqualifyingaccountsdeductedfromassets:Allowances for notes and accounts receivable $ 12.0 $ 3.2 $ (1.5) $ — $ 13.7 Valuation allowance for deferred tax assets(3) 19.9 9.2 (5.0) — 24.1


(Inmillions)


period


Other,net(1)


Valuationandqualifyingaccountsdeductedfromassets:Allowances for notes and accounts receivable $ 12.0 $ — $ — $ — $ 12.0 Valuation allowance for deferred tax assets(4) 12.0 10.7 (2.8) — 19.9

___________________________________________________________________________________________________________________

(1) Effects of currency translation.(2) The valuation allowance increased $14.6 million from December 31, 2019, to December 31, 2020. The increase was primarily due to projected

consolidated taxable income, causing the expiration of foreign tax credits in 2021.(3) The valuation allowance increased $4.2 million from December 31, 2018, to December 31, 2019. The increase was primarily due to the projected

taxable income in certain foreign jurisdictions.(4) The valuation allowance increased $7.9 million from December 31, 2017, to December 31, 2018. The increase was primarily due to changes in

expected foreign tax credit utilization.

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Item9.CHANGESINANDDISAGREEMENTSWITHACCOUNTANTSONACCOUNTINGANDFINANCIALDISCLOSURE

None.

Item9A.CONTROLSANDPROCEDURES

Except as provided below, the disclosure required by this Item appears in Item 8 under the headings “Management’s Report on InternalControl Over Financial Reporting” and “Report of Independent Registered Public Accounting Firm,” which disclosure is incorporated herein byreference.

There was no change in Grace’s internal control over financial reporting during the quarter ended December 31, 2020, that has materiallyaffected, or is reasonably likely to materially affect, Grace’s internal control over financial reporting.

Item9B.OTHERINFORMATION

None.

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PARTIII

Item10.DIRECTORS,EXECUTIVEOFFICERSANDCORPORATEGOVERNANCE

Information required by this Item regarding Grace’s executive officers appears at Part I after Item 4 of this report. The other informationrequired by this Item is incorporated by reference to the definitive proxy statement that Grace will file with the SEC no later than 120 days afterDecember 31, 2020 (the “2021 Proxy Statement”).

Item11.EXECUTIVECOMPENSATION

The information required by this Item is incorporated by reference to the 2021 Proxy Statement.

Item12.SECURITYOWNERSHIPOFCERTAINBENEFICIALOWNERSANDMANAGEMENTANDRELATEDSTOCKHOLDERMATTERS


Item13.CERTAINRELATIONSHIPSANDRELATEDTRANSACTIONS,ANDDIRECTORINDEPENDENCE


Item14.PRINCIPALACCOUNTANTFEESANDSERVICES

The information required by this Item is Incorporated by reference to the 2021 Proxy Statement.

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PARTIV

Item15.EXHIBITS,FINANCIALSTATEMENTSCHEDULES

Financial Statements and Schedules. The required information is set forth in Item 8, which is incorporated herein by reference.

Exhibits. The exhibits to this Report are listed below. Other than exhibits that are filed herewith, all exhibits listed below are incorporated byreference.

In reviewing the agreements included as exhibits to this and other Reports filed by Grace with the Securities and Exchange Commission,please remember they are included to provide you with information regarding their terms and are not intended to provide any other factual ordisclosure information about Grace or other parties to the agreements. The agreements generally contain representations and warranties by each ofthe parties to the applicable agreement. These representations and warranties have been made solely for the benefit of the other parties to theapplicable agreement. These representations and warranties:

• are not statements of fact, but rather are used to allocate risk to one of the parties if the statements prove to be inaccurate;

• may have been qualified by disclosures that were made to the other parties in connection with the negotiation of the applicableagreement, which disclosures are not necessarily reflected in the agreement;

• may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and

• were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and donot reflect more recent developments.

Accordingly, these representations and warranties may not describe the actual state of affairs as of the date they were made or at any othertime. Additional information about Grace may be found elsewhere in this report and Grace’s other public filings, which are available without chargethrough the Securities and Exchange Commission’s website at http://www.sec.gov.

ExhibitNo. Exhibit Location2.1 Joint Plan of Reorganization of W. R. Grace & Co. and its Debtor Subsidiaries. Exhibit 2.01 to Form 8-K (filed 2/07/14) SEC

File No.: 001-139532.2 Order Confirming Joint Plan of Reorganization. Exhibit 2.02 to Form 8-K (filed 2/07/14) SEC

File No.: 001-139532.3 Separation and Distribution Agreement, dated as of January 27, 2016, by and among W. R.

Grace & Co., W. R. Grace & Co.–Conn. and GCP Applied Technologies Inc.Exhibit 2.1 to Form 8-K (filed 1/28/16) SEC FileNo.: 001-13953

2.4 Amended and Restated Sale and Purchase Agreement, dated as of February 21, 2018, byand between Albemarle Corporation and W. R. Grace & Co.–Conn.

Exhibit 2.4 to Form 10-K (filed 2/22/18) SECFile No.: 001-13953

2.5 Sale, Purchase and Contribution Agreement, dated as of February 25, 2021, by and amongAlbemarle Corporation, W. R. Grace & Co.–Conn., and Fine Chemical ManufacturingServices LLC.

Filed herewith.

3.1 Amended and Restated Certificate of Incorporation. Exhibit 3.01 to Form 8-K (filed 2/07/14) SECFile No.: 001-13953

3.2 Amended and Restated By-laws. Exhibit 3.01 to Form 8-K (filed 1/23/15) SECFile No.: 001-13953

4.1 Credit Agreement, dated as of February 3, 2014, by and among W. R. Grace & Co., W. R.Grace & Co.–Conn., Grace GmbH & Co. KG, a Federal Republic of Germany limitedpartnership, each lender from time to time party thereto, and Goldman Sachs Bank USA, asAdministrative Agent.

Exhibit 4.01 to Form 8-K (filed 2/07/14) SECFile No.: 001-13953

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https://content.edgar-online.com/ExternalLink/EDGAR/0001045309-18-000014.html?hash=9a380e7da6f2cbbc3ad431b8cfa126a41a23b71000219d5150ede4546c6b6534&dest=A4Q17EXHIBIT2_4_HTM

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ExhibitNo. Exhibit Location4.2 First Amendment and Consent to Credit Agreement and First Amendment to Security

Agreement, dated as of November 25, 2015, by and among W. R. Grace & Co., W. R.Grace & Co.–Conn., Grace GmbH & Co. KG, Alltech Associates, Inc., each lender fromtime to time party thereto, and Goldman Sachs Bank USA, as Administrative Agent andlender.

Exhibit 10.1 to Form 8-K (filed 11/25/15) SEC FileNo.: 001-13953

4.3 Deferred Payment Agreement (PD), dated as of February 3, 2014, by and between W. R.Grace & Co.–Conn. and the WRG Asbestos PD Trust.


4.4 Guarantee Agreement (PD), dated as of February 3, 2014, by and between W. R. Grace &Co. and the WRG Asbestos PD Trust.


4.5 Deferred Payment Agreement (PD-ZAI), dated as of February 3, 2014, by and between W.R. Grace & Co.–Conn. and the WRG Asbestos PD Trust.


4.6 Guarantee Agreement (PD-ZAI), dated as of February 3, 2014, by and between W. R.Grace & Co. and the WRG Asbestos PD Trust.


4.7 Share Issuance Agreement, dated as of February 3, 2014, by and among W. R. Grace &Co., the WRG Asbestos PD Trust and the WRG Asbestos PI Trust.


4.8 Indenture, dated as of September 16, 2014, by and among W. R. Grace & Co.–Conn., theguarantors party there to and Wilmington Trust, National Association, as trustee.


4.9 First Supplemental Indenture, dated as of September 16, 2014, by and among W. R.Grace & Co.–Conn., the guarantors party thereto and Wilmington Trust, NationalAssociation, as trustee.


4.10 Form of 5.125% Note due 2021 (included as Exhibit A-1 to Exhibit 4.9). Exhibit 4.3 (included as Exhibit A-1 to Exhibit 4.2)to Form 8-K (filed 9/19/14) SEC File No.: 001-13953

4.11 Form of 5.625% Note due 2024 (included as Exhibit A-2 to Exhibit 4.9). Exhibit 4.4 (included as Exhibit A-2 to Exhibit 4.2)to Form 8-K (filed 9/19/14) SEC File No.: 001-13953

4.12 Credit Agreement, dated as of April 3, 2018, by and among W. R. Grace & Co., W. R.Grace & Co.–Conn., certain subsidiaries thereof, Goldman Sachs Bank USA, asAdministrative Agent and Collateral Agent, and the other lenders from time to time partythereto.


4.13 Second Supplemental Indenture, dated as of April 3, 2018, by and among W. R. Grace &Co.–Conn., the guarantors party thereto and Wilmington Trust, National Association, astrustee.

Exhibit 4.2 to Form 10-Q (filed 5/09/18) SEC FileNo.: 001-13953

4.14 Description of W. R. Grace & Co. Securities. Exhibit 4.14 to Form 10-K (filed 2/27/20) SEC FileNo.: 001-13953

4.15 Third Supplemental Indenture, dated as of June 26, 2020, by and among W. R. Grace &Co.–Conn., the guarantors party thereto and Wilmington Trust, National Association, astrustee.


4.16 Form of 4.875% Note due 2027 (included as Exhibit A to Exhibit 4.15). Exhibit 4.3 (included as Exhibit A to Exhibit 4.2)to Form 8-K (filed 6/26/20) SEC File No.: 001-13953

10.1 WRG Asbestos Property Damage Settlement Trust Agreement, dated as of February 3,2014, by and between W. R. Grace & Co., the Asbestos PD Future Claimants’Representative, the Official Committee of Asbestos Property Damage Claimants, theAsbestos PD Trustees, Wilmington Trust Company, and the members of the Zonolite AtticInsulation Trust Advisory Committee.


10.2 W. R. Grace & Co. 2014 Stock Incentive Plan. Exhibit 10.03 to Form 8-K (filed 2/07/14) SEC FileNo.: 001-13953*

10.3 Form of Performance-based Unit Agreement (2016). Exhibit 10.2 to Form 8-K (filed 2/09/16) SEC FileNo.: 001-13953*

10.4 Form of Stock Option Award Agreement (2016). Exhibit 10.1 to Form 8-K (filed 2/09/16) SEC FileNo.: 001-13953*

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ExhibitNo. Exhibit Location10.5 Form of Restricted Stock Award Agreement (2016). Exhibit 10.3 to Form 8-K (filed 2/09/16) SEC File

No.: 001-13953*10.6 W. R. Grace & Co. Supplemental Executive Retirement Plan, as amended. Exhibit 10.7 to Form 10-K (filed 3/28/02) SEC File

No.: 001-13953*10.7 W. R. Grace & Co. Executive Salary Protection Plan, as amended. Exhibit 10.8 to Form 10-K (filed 3/28/02) SEC File

No.: 001-13953*10.8 Form of Executive Change in Control Severance Agreement between Grace and certain

officers.Exhibit 10.17 to Form 10-K (filed 3/13/03) SECFile No.: 001-13953*

10.9 Severance Plan for Leadership Team Officers of W. R. Grace & Co. Exhibit 10.2 to Form 8-K (filed 2/04/16) SEC FileNo.: 001-13953*

10.10 2015 Executive Annual Incentive Compensation Plan. Exhibit 10.1 to Form 8-K (filed 5/12/15) SEC FileNo.: 001-13953*

10.11 Tax Sharing Agreement, dated as of January 27, 2016, by and among W. R. Grace & Co.,W. R. Grace & Co.–Conn. and GCP Applied Technologies Inc.


10.12 Letter Agreement dated February 28, 2008, between Fred Festa, on behalf of Grace, andHudson La Force III (includes indemnification provision).

Exhibit 10.1 to Form 8-K (filed 3/07/08) SEC FileNo.: 001-13953*

10.13 Letter Agreement dated November 13, 2013, between Fred Festa, on behalf of Grace, andKeith N. Cole (includes indemnification provision).

Exhibit 10.20 to Form 10-K (filed 2/25/15) SECFile No.: 001-13953*

10.14 Letter Agreement dated December 3, 2014, between Fred Festa, on behalf of Grace, andElizabeth C. Brown (includes indemnification provision).

Exhibit 10.1 to Form 10-Q (filed 5/07/15) SEC FileNo.: 001-13953*

10.15 Restricted Stock Unit Award Agreement, dated February 22, 2018, between W. R. Grace &Co. and Fred Festa, in connection with transition to Non-executive Chairman.


10.16 Stock Option Award Agreement, dated February 22, 2018, between W. R. Grace & Co.and Fred Festa, in connection with transition to Non-Executive Chairman.


10.17 W. R. Grace & Co. 2018 Stock Incentive Plan. Exhibit 10.1 to Form 8-K (filed 5/14/18) SEC FileNo.: 001-13953*

10.18 Form of W. R. Grace & Co. Performance-Based Units (“PBUs”) Grant Agreement (2018). Exhibit 10.2 to Form 10-Q (filed 8/08/18) SEC FileNo.: 001-13953*

10.19 Form of W. R. Grace & Co. Restricted Share Units (“RSUs”) Grant Agreement (2018). Exhibit 10.3 to Form 10-Q (filed 8/08/18) SEC FileNo.: 001-13953*

10.20 Form of W. R. Grace & Co. Nonstatutory Stock Option (“NSOs”) Grant Agreement (2018). Exhibit 10.4 to Form 10-Q (filed 8/08/18) SEC FileNo.: 001-13953*

10.21 Separation Agreement and General Release, dated as of May 31, 2018, by and betweenW. R. Grace & Co.–Conn., et al., and Thomas E. Blaser.


10.22 Letter Agreement, dated as of February 20, 2019, by and among W. R. Grace & Co., 40North Management LLC, 40 North GP III LLC, 40 North Latitude Master Fund Ltd. and 40North Latitude Fund LP.

Exhibit 99.1 to Form 8-K (filed 2/20/19) SEC FileNo.: 001-13953*

10.23 Letter Agreement dated November 13, 2020, between Elizabeth C. Brown, on behalf ofGrace, and Cherée H. Johnson (includes indemnification provision).

Filed herewith*

21 List of Subsidiaries of W. R. Grace & Co. Filed herewith23 Consent of Independent Registered Public Accounting Firm. Filed herewith24 Powers of Attorney. Filed herewith

31(i).1 Certification of Periodic Report by Chief Executive Officer under Section 302 of theSarbanes-Oxley Act of 2002.

Filed herewith

31(i).2 Certification of Periodic Report by Chief Financial Officer under Section 302 of theSarbanes-Oxley Act of 2002.

Filed herewith

32 Certification of Periodic Report by Chief Executive Officer and Chief Financial Officer underSection 906 of the Sarbanes-Oxley Act of 2002.

Furnished herewith

95 Mine Safety Disclosure Exhibit. Filed herewith

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ExhibitNo. Exhibit Location101.INS Inline XBRL Instance Document The instance document does not appear in the

Interactive Data File because its XBRL tags areembedded within the Inline XBRL document.

101.SCH Inline XBRL Taxonomy Extension Schema Filed herewith101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Filed herewith101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Filed herewith101.LAB Inline XBRL Taxonomy Extension Label Linkbase Filed herewith101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Filed herewith

104 Cover Page Interactive Data File (formatted as Inline XBRL and included in Exhibit 101) Filed herewith___________________________________________________________________________________________________________________

* Management contracts and compensatory plans, contracts or arrangements required to be filed as exhibits to this Report.

Item16.FORM10-KSUMMARY

None.

121


SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Report to besigned on its behalf by the undersigned, thereunto duly authorized.

W. R. GRACE & CO.By: /s/ HUDSON LA FORCE

Hudson La ForcePresident and Chief Executive Officer

(Principal Executive Officer)By: /s/ WILLIAM C. DOCKMAN

William C. DockmanSenior Vice President and Chief Financial Officer

(Principal Financial Officer andPrincipal Accounting Officer)

Dated: February 25, 2021

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf ofthe registrant and in the capacities indicated on February 25, 2021.

Signature TitleR. F. Cummings, Jr.* }D. H. Gulyas* }J. Fasone Holder* }H. R. Slack* } DirectorsC. J. Steffen* }M. E. Tomkins* } S. Yanai* }

/s/ HUDSON LA FORCE President and Chief Executive Officer and Director (Principal Executive Officer)

Hudson La Force

/s/ WILLIAM C. DOCKMAN Senior Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

William C. Dockman

___________________________________________________________________________________________________________________

* By signing her name hereto, Cherée H. Johnson is signing this document on behalf of each of the persons indicated above pursuant topowers of attorney duly executed by such persons and filed with the Securities and Exchange Commission.

By: /s/ CHERÉE H. JOHNSONCherée H. Johnson

(Attorney-in-Fact)

122

CONFIDENTIAL EXECUTION DRAFT

SALE, PURCHASE AND CONTRIBUTION AGREEMENT

BY AND AMONG

ALBEMARLE CORPORATION,

W. R. GRACE & CO.-CONN.

And

FINE CHEMICAL MANUFACTURING SERVICES LLC

Dated as of February 25, 2021

21360825

TABLE OF CONTENTS

Page

Article I DEFINITIONS 2Section 1.1 2021 Bonus Stub Period. 2Section 1.2 2021 Bonus Stub Period Performance Bonuses. 2Section 1.3 Accrued 2020 Performance Bonuses. 2Section 1.4 Accrued 2021 Performance Bonuses. 2Section 1.5 Accrued Performance Bonuses. 2Section 1.6 Act 2. 2Section 1.7 Action. 2Section 1.8 Additional Employee Data. 2Section 1.9 Affiliate. 2Section 1.10 Aggregate Transaction Value. 3Section 1.11 Agreement. 3Section 1.12 Alternative Financing 3Section 1.13 Antitrust Law. 3Section 1.14 Allocation Schedule. 3Section 1.15 Anti-Corruption Laws. 3Section 1.16 Assumed Liabilities. 3Section 1.17 Baseline Net Working Capital. 3Section 1.18 Basket. 4Section 1.19 Beneficial Ownership Regulation 4Section 1.20 Business. 4Section 1.21 Business Day. 4Section 1.22 Business Employee. 4Section 1.23 Business Products. 4Section 1.24 CARES Act. 5Section 1.25 Closing. 5Section 1.26 Closing Date. 5Section 1.27 Closing Date Employees. 5Section 1.28 Closing Date Cash Payment. 5Section 1.29 Code. 5Section 1.30 Common Interests. 5Section 1.31 Confidential Information. 5Section 1.32 Confidentiality Agreement. 5Section 1.33 Confidential Management Presentation. 5Section 1.34 Consultant. 5Section 1.35 Contract. 6Section 1.36 Contribution. 6

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Section 1.37 control. 6Section 1.38 Cooperation Indemnitees 6Section 1.39 COVID Actions. 6Section 1.40 Current Employees. 6Section 1.41 De Minimis Claim. 6Section 1.42 Disclosure Schedules. 6Section 1.43 Debt Commitment Letter. 7Section 1.44 Debt Financing. 7Section 1.45 Debt Financing Agreements. 7Section 1.46 Dispute Notice. 7Section 1.47 Disputed Items. 7Section 1.48 Drug Laws. 7Section 1.49 Employee Records. 7Section 1.50 Encumbrance. 7Section 1.51 Environmental Law. 8Section 1.52 Environmental Losses. 8Section 1.53 Environmental Permit. 8Section 1.54 Equipment. 8Section 1.55 ERISA. 8Section 1.56 ESA. 8Section 1.57 Estimated Purchase Price Statement. 8Section 1.58 Excluded Assets. 8Section 1.59 Excluded Claim. 9Section 1.60 Excluded Liabilities. 9Section 1.61 Excluded Taxes. 9Section 1.62 Existing Stock. 9Section 1.63 FDA. 9Section 1.64 FDCA. 9Section 1.65 FDCA Debarment List. 9Section 1.66 Final Net Working Capital. 9Section 1.67 Final Phase II Reports. 9Section 1.68 Financial Statements. 10Section 1.69 Financing Sources 10Section 1.70 GAAP. 10Section 1.71 Goodwill. 10Section 1.72 Governmental Authority. 10Section 1.73 Governmental Order. 10Section 1.74 Hazardous Material. 10Section 1.75 HSR Act. 11Section 1.76 Indebtedness. 11Section 1.77 Indemnified Party. 11

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Section 1.78 Indemnifying Party. 11Section 1.79 Independent Accountant. 11Section 1.80 In-Licensed Intellectual Property. 11Section 1.81 Intellectual Property. 11Section 1.82 Intellectual Property Assignment Agreement. 12Section 1.83 Intended Tax Treatment. 12Section 1.84 IP Agreements. 12Section 1.85 IRS. 12Section 1.86 IT Assets. 12Section 1.87 Key Customer. 12Section 1.88 Key Distributors. 13Section 1.89 Key Supplier. 13Section 1.90 Law. 13Section 1.91 Leave Employees. 13Section 1.92 Liabilities. 13Section 1.93 Local Conveyance Documents. 13Section 1.94 Loss. 13Section 1.95 Manufacturing Facilities. 13Section 1.96 Marketing Period 13Section 1.97 Material Adverse Effect. 14Section 1.98 Material Contracts. 14Section 1.99 Most Cost-Effective Manner. 15Section 1.100 Net Working Capital. 15Section 1.101 Non-Transferred Environmental Permit. 15Section 1.102 Owned Real Property. 15Section 1.103 Permits. 15Section 1.104 Permitted Encumbrances. 15Section 1.105 Person. 16Section 1.106 Plan. 16Section 1.107 Pollution Policy. 16Section 1.108 Post-Closing Adjustment. 16Section 1.109 Post-Closing Tax Period. 16Section 1.110 Post-Signing Insurance Proceeds. 16Section 1.111 Pre-Closing IT Integration Completion 17Section 1.112 Pre-Closing Tax Period. 17Section 1.113 Preferred Equity. 17Section 1.114 Preferred Issuance. 17Section 1.115 Preferred Unit Face Value. 17Section 1.116 Preferred Units. 17Section 1.117 Preliminary Net Working Capital. 17Section 1.118 Protected Communications. 17

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Section 1.119 Public Announcement. 17Section 1.120 Purchase Price. 17Section 1.121 Purchaser. 18Section 1.122 Purchaser 401(k) Plan. 18Section 1.123 Purchaser Benefit Plan. 18Section 1.124 Purchaser DC Plan Contributions. 18Section 1.125 Purchaser Disclosure Schedule. 18Section 1.126 Purchaser Environmental Liabilities. 18Section 1.127 Purchaser FSA Plan. 19Section 1.128 Purchaser Fundamental Representations. 19Section 1.129 Purchaser Indemnified Party. 19Section 1.130 Purchaser-Owned IP 19Section 1.131 Registered Intellectual Property. 19Section 1.132 Related Party. 19Section 1.133 Related Party Contract. 19Section 1.134 Release. 19Section 1.135 Remedial Action. 20Section 1.136 Representatives. 20Section 1.137 Required Information 20Section 1.138 Retained Names and Marks. 20Section 1.139 Retention Agreement Recipients. 20Section 1.140 Retention Agreements. 20Section 1.141 Return Deadline. 20Section 1.142 Sale and Purchase. 20Section 1.143 Sales Contracts. 21Section 1.144 Sales Agreements. 21Section 1.145 Sanctions. 21Section 1.146 Securities Act. 21Section 1.147 Seller. 21Section 1.148 Seller 401(k) Plan. 21Section 1.149 Seller Benefit Plan. 21Section 1.150 Seller Disclosure Schedule. 21Section 1.151 Seller Environmental Liabilities. 21Section 1.152 Seller FSA Plan. 22Section 1.153 Seller Fundamental Representations. 22Section 1.154 Seller Indemnified Party. 22Section 1.155 Seller Indemnified Remedial Action or Environmental Noncompliance. 22Section 1.156 Seller’s Knowledge; Knowledge of the Seller. 22Section 1.157 Seller Restricted Parties. 22Section 1.158 Shared Contracts. 22Section 1.159 Shared Information. 22

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Section 1.160 SPV. 23Section 1.161 SPV Operating Agreement. 23Section 1.162 Straddle Period. 23Section 1.163 Subsidiary. 23Section 1.164 Survey. 23Section 1.165 Tax; Taxes. 23Section 1.166 Tax Returns. 23Section 1.167 Termination Date. 23Section 1.168 Third-Party Claim. 23Section 1.169 Third-Party Rights. 24Section 1.170 Title Commitment. 24Section 1.171 Title Insurance. 24Section 1.172 Title Insurer. 24Section 1.173 Title Policy. 24Section 1.174 Trade Accounts Payable. 24Section 1.175 Trade Controls. 24Section 1.176 Transaction Documents. 24Section 1.177 Transfer Date. 24Section 1.178 Transfer Taxes. 24Section 1.179 Transferred Accounts Receivable. 25Section 1.180 Transferred Assets. 25Section 1.181 Transferred Contracts. 25Section 1.182 Transferred Employee. 25Section 1.183 Transferred Information. 25Section 1.184 Transferred Intellectual Property. 25Section 1.185 Transferred Inventory. 25Section 1.186 Transferred IP Agreements. 26Section 1.187 Transferred IT Assets. 26Section 1.188 Transferred Permits. 26Section 1.189 Transferred Records. 26Section 1.190 Transition Services Agreement. 26Section 1.191 Treasury Regulations. 27Section 1.192 Trigger Levels. 27Section 1.193 WARN Act. 27Article II SALE AND PURCHASE 27Section 2.1 Sale and Purchase of Assets. 28Section 2.2 Assumption and Exclusion of Liabilities. 30Section 2.3 Contribution of Transferred Assets and Assumed Liabilities. 32Section 2.4 Procedures for the Transfer of Transferred Assets 32Section 2.5 Shared Contracts; Assignment of Contracts and Rights; Post-Signing Insurance Proceeds. 32

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Section 2.6 Allocation of Purchase Price. 33Section 2.7 Closing 34Section 2.8 Closing Deliveries by the Seller 34Section 2.9 Closing Deliveries by the Purchaser 35Section 2.10 Preliminary Adjustment of Purchase Price 35Section 2.11 Final Net Working Capital; Adjustment of Purchase Price. 36Section 2.12 Withholding 38Article III REPRESENTATIONS AND WARRANTIES OF THE SELLER 38Section 3.1 Organization, Authority and Qualification of the Seller. 38Section 3.2 No Conflict 39Section 3.3 Governmental Consents and Approvals 39Section 3.4 Financial Information. 40Section 3.5 Absence of Changes; No Material Adverse Effect 40Section 3.6 Litigation 40Section 3.7 Compliance with Laws. 40Section 3.8 Intellectual Property. 41Section 3.9 Real Property. 43Section 3.10 Employees; Employee Benefit Matters. 44Section 3.11 Labor Matters. 46Section 3.12 Taxes. 47Section 3.13 Material Contracts. 47Section 3.14 Environmental Matters. 50Section 3.15 Customers, Suppliers and Distributors. 51Section 3.16 Inventory 51Section 3.17 Title to Assets; Sufficiency of Assets 52Section 3.18 Brokers 52Section 3.19 Governmental Licenses and Permits. 52Section 3.20 Product Liability; Product Warranties 53Section 3.21 Transferred Accounts Receivable 53Section 3.22 Drug Laws. 53Section 3.23 Insurance 54Section 3.24 Relationships with Related Parties 54Section 3.25 Investment Representations. 55Section 3.26 Disclaimer of the Seller. 55Article IV REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND SPV 56Section 4.1 Organization, Authority and Qualification of the Purchaser 56Section 4.2 No Conflict 57Section 4.3 Governmental Consents and Approvals 57Section 4.4 Litigation 57Section 4.5 Brokers 58

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Section 4.6 Debt Financing 58Section 4.7 Operations of the SPV 59Section 4.8 Issuance of Preferred Equity 59Section 4.9 Independent Investigation; Seller’s Representations. 60Article V ADDITIONAL AGREEMENTS 61Section 5.1 Conduct of Business Prior to the Closing 61Section 5.2 Access to Information and Manufacturing Facilities. 63Section 5.3 Confidentiality. 65Section 5.4 Regulatory and Other Authorizations; Notices and Consents. 66Section 5.5 Retained Names and Marks. 68Section 5.6 IP Matters. 69Section 5.7 Insurance 70Section 5.8 Employees. 70Section 5.9 Privileged Matters 76Section 5.10 Further Action; Third Party Consents. 76Section 5.11 Misdirected Payments. 77Section 5.12 Title Insurance. 78Section 5.13 Financing 78Section 5.14 EHS and FDA Regulatory Information. 81Article VI TAX MATTERS 81Section 6.1 Straddle Period Taxes 81Section 6.2 Tax Cooperation and Exchange of Information 81Section 6.3 Transfer Taxes. 82Section 6.4 Bulk Sales. 82Section 6.5 Tax Treatment. 82Section 6.6 Wage Reporting. 83Article VII CONDITIONS TO CLOSING 83Section 7.1 Conditions to Obligations of the Seller 83Section 7.2 Conditions to Obligations of the Purchaser and the SPV 84Article VIII INDEMNIFICATION 85Section 8.1 Survival of Representations, Warranties and Covenants 85Section 8.2 Indemnification by the Seller 85Section 8.3 Indemnification by the Purchaser. 86Section 8.4 Limitations on Indemnification. 86Section 8.5 Notice of Loss; Third-Party Claims. 87Section 8.6 Remedies 89Section 8.7 Further Environmental Provisions. 89Section 8.8 Subrogation 95Article IX TERMINATION 95Section 9.1 Termination 95Section 9.2 Effect of Termination 96

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Article X RESTRICTIVE COVENANTS 96Section 10.1 Non-Competition 96Section 10.2 Non-Solicitation of Employees 97Section 10.3 Non-Solicitation or Interference with Customers and Suppliers 97Section 10.4 Acknowledgments; Enforcement. 97Article XI GENERAL PROVISIONS 98Section 11.1 Expenses 98Section 11.2 Seller Disclosure Schedule 98Section 11.3 Notices 98Section 11.4 Public Announcements 100Section 11.5 Severability 100Section 11.6 Entire Agreement 100Section 11.7 No Setoff 100Section 11.8 Assignment 101Section 11.9 Amendment 101Section 11.10 Waiver 101Section 11.11 No Third-Party Beneficiaries 101Section 11.12 Specific Performance 102Section 11.13 Governing Law 102Section 11.14 Waiver of Jury Trial 103Section 11.15 Counterparts 103Section 11.16 Interpretation and Rules of Construction. 103

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EXHIBIT

Exhibit A-1 Form of Assignment and Assumption Agreement and Bill of SaleExhibit A-2 Form of Deed of Transfer of Owned Real Property (Tyrone)Exhibit A-3 Form of Deed of Transfer of Owned Real Property (South Haven)Exhibit B Form of Intellectual Property Assignment AgreementExhibit C-1 Form of Sales Agreement (New Johnsonville)Exhibit C-2 Form of Sales Agreement (Bromine)Exhibit D Form of SPV Operating AgreementExhibit E Form of Transition Services AgreementExhibit F Principles of Scope of Phase II at the South Haven, Michigan Manufacturing FacilityExhibit G Pollution Policy

SELLER DISCLOSURE SCHEDULES

Section 1.54 Excluded EquipmentSection 1.68 Financial StatementsSection 1.100 Net Working CapitalSection 1.102 Owned Real PropertySection 1.104 Permitted EncumbrancesSection 1.137 Required InformationSection 1.139 Retention Agreement RecipientsSection 1.156 Seller’s Knowledge PartiesSection 1.158 Shared ContractsSection 1.188 Transferred PermitsSection 1.189 Transferred RecordsSection 2.1(b)(xvi) Certain Excluded AssetsSection 2.2(a)(vii) Certain Assumed LiabilitiesSection 2.2(b)(x) Certain Excluded LiabilitiesSection 3.2 No ConflictSection 3.4 Financial Information Procedures and MethodologiesSection 3.7(b) Compliance with LawsSection 3.8(a) Transferred Intellectual PropertySection 3.8(b) Transferred Intellectual Property EncumbrancesSection 3.8(f) Royalties, Honoraria, Fees or Other PaymentsSection 3.10(a) Business EmployeesSection 3.10(b) Seller Benefit PlansSection 3.11(e) Improper Exclusions from Seller Benefit PlansSection 3.12(c) Unresolved or Unpaid Tax Claims or DeficienciesSection 3.13(a) Material ContractsSection 3.14(a) Environmental MattersSection 3.15(a) Key CustomersSection 3.15(b) Key SuppliersSection 3.15(c) Key Distributors

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Section 3.15(d)(i) Notices from Key Customers, Key Suppliers and Key DistributorsSection 3.15(d)(ii) Changes related to Key Customers, Key Suppliers and Key DistributorsSection 3.19 Transferred PermitsSection 3.20 Product Warranty ClaimsSection 3.22(a) Compliance with Drug LawsSection 3.24 Relationships with Related PartiesSection 5.1 Conduct of Business Prior to the ClosingSection 5.6(d) Pre-Closing IntegrationSection 5.10(d) Form of Authorization to Share InformationSection 7.1(b) Governmental ApprovalsSection 7.2(g) Third Party Consents and ApprovalsSection 8.2(e) Specified Indemnity

PURCHASER DISCLOSURE SCHEDULES

Section 4.2 No Conflict

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SALE, PURCHASE AND CONTRIBUTION AGREEMENT

This SALE, PURCHASE AND CONTRIBUTION AGREEMENT is made as of February 25, 2021, by and betweenAlbemarle Corporation, a Virginia corporation (the “Seller”), W. R. Grace & Co.-Conn., a Connecticut corporation (the“Purchaser”), and Fine Chemical Manufacturing Services LLC, a Delaware limited liability company (the “SPV”).

WHEREAS, the Seller and certain of its Subsidiaries are engaged in the Business (as hereinafter defined);

WHEREAS, the Seller and its Subsidiaries own all of the Transferred Assets (as hereinafter defined);

WHEREAS, the Purchaser is the sole member of the SPV and owns all of the issued and outstanding membership interestsof the SPV;

WHEREAS, the Seller wishes to sell to the SPV, and the Purchaser wishes to purchase from the Seller on behalf of the SPV,52.6% of each of the Transferred Assets (as hereinafter defined), and in connection therewith the Purchaser is willing to assumefrom the Seller 52.6% of each of the Assumed Liabilities, subject to adjustment to account for any adjustments to Purchase Pricehereunder and to account for the Transferred Intellectual Property sold to and purchased by (and to be held by) the Purchaser (the“Purchaser-Owned IP”), upon the terms and subject to the conditions set forth herein (the “Sale and Purchase”);

WHEREAS, the Seller, the Purchaser and the SPV intend that for income Tax purposes, (a) the transfer of the TransferredAssets in exchange for the Purchase Price (as hereinafter defined) pursuant to the Sale and Purchase shall be treated as a sale andpurchase of 52.6% of each of the Transferred Assets (and an assumption of 52.6% of each of the Assumed Liabilities by thePurchaser), subject to adjustment to account for any adjustments to Purchase Price hereunder and to account for the Purchaser-Owned IP, in a transaction subject to Section 1001 of the Code (as hereinafter defined) and (b) the Contribution and the PreferredIssuance, together, shall be treated as a contribution of 47.4% of each of the Transferred Assets to the SPV (and an assumption of47.4% of each of the Assumed Liabilities by the SPV), subject to adjustment to account for any adjustments to Purchase Pricehereunder and to account for the Purchaser-Owned IP, in an exchange pursuant to Situation 2 of IRS Revenue Ruling 99-5, 1999-1C.B. 434 and Section 721 of the Code; and

WHEREAS, at the Closing, the Purchaser, the Seller and the SPV wish to enter into that certain SPV Operating Agreement(as hereinafter defined), pursuant to which, in exchange for a contribution of 47.4% of each of the Transferred Assets to the SPV(and an assumption of 47.4% of each of the Assumed Liabilities (as hereinafter defined) by the SPV), subject to adjustment toaccount for any adjustments to Purchase Price hereunder and to account for the Purchaser-Owned IP (the “Contribution”), the SPVwill issue to the Seller the Preferred Equity (as hereinafter defined) of the SPV (the “Preferred Issuance”).

NOW, THEREFORE, in consideration of the foregoing premises and the respective representations, warranties, covenantsand agreements contained in this Agreement, and intending to be legally bound hereby, the Seller, the Purchaser and the SPV herebyagree as follows:

Article I.

DEFINITIONSWhen used in this Agreement, the following terms shall have the meanings specified:

Section 1.1 2021 Bonus Stub Period.

“2021 Bonus Stub Period” shall have the meaning set forth in Section 5.8(c).

Section 1.2 2021 Bonus Stub Period Performance Bonuses.

“2021 Bonus Stub Period Performance Bonuses” shall have the meaning set forth in Section 5.8(c).

Section 1.3 Accrued 2020 Performance Bonuses.

“Accrued 2020 Performance Bonuses” shall have the meaning set forth in Section 5.8(c).

Section 1.4 Accrued 2021 Performance Bonuses.

“Accrued 2021 Performance Bonuses” shall have the meaning set forth in Section 5.8(c).

Section 1.5 Accrued Performance Bonuses.

“Accrued Performance Bonuses” shall have the meaning set forth in Section 5.8(c).

Section 1.6 Act 2.

“Act 2” means the Land Recycling Standards and Remediation Act, 35 P.S. 6026.101 et seq.

Section 1.7 Action.

“Action” means any claim, action, law, litigation, suit, arbitration, charge, grievance, labor dispute, audit,inquiry, proceeding or investigation by or before any Governmental Authority or arbitral board or body.

Section 1.8 Additional Employee Data.

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“Additional Employee Data” shall have the meaning set forth in Section 3.10(a).

Section 1.9 Affiliate.

“Affiliate” means, with respect to any specified Person, any other Person that, directly or indirectly, throughone or more intermediaries, controls, is controlled by, or is under common control with, such specified Person.

Section 1.10 Aggregate Transaction Value.

“Aggregate Transaction Value” means $570,000,000, which is the sum of (a) the Purchase Price and (b) theaggregate Preferred Unit Face Value of the Preferred Equity.

Section 1.11 Agreement.

“Agreement” means this Sale, Purchase and Contribution Agreement between the parties hereto (including theExhibits and Schedules hereto) and all amendments hereto made in accordance with the provisions of Section 11.9.

Section 1.12 Alternative Financing

.

“Alternative Financing” shall have the meaning set forth in Section 5.13(a).

Section 1.13 Antitrust Law.

“Antitrust Law” means the Sherman Antitrust Act of 1890, the Clayton Antitrust Act of 1914, the HSR Act,the Federal Trade Commission Act of 1914 and all other Laws that are designed or intended to prohibit, restrict or regulateactions having the purpose or effect of monopolization or restraint of trade or significant impediments or lessening ofcompetition or the creation or strengthening of a dominant position through merger or acquisition, in any case that areapplicable to the transactions contemplated by this Agreement or the other Transaction Documents.

Section 1.14 Allocation Schedule.

“Allocation Schedule” shall have the meaning set forth in Section 2.6(a).

Section 1.15 Anti-Corruption Laws.

“Anti-Corruption Laws” means (a) the U.S. Foreign Corrupt Practices Act of 1977, as amended; (b) the U.K.Bribery Act 2010, as amended; and (c) any other applicable Law related to anti-bribery or anti-corruption.

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Section 1.16 Assumed Liabilities.

“Assumed Liabilities” shall have the meaning set forth in Section 2.2(a).

Section 1.17 Baseline Net Working Capital.

“Baseline Net Working Capital” means $52,500,000.

Section 1.18 Basket.

“Basket” shall have the meaning set forth in Section 8.4(b).

Section 1.19 Beneficial Ownership Regulation

.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

Section 1.20 Business.

“Business” means the Fine Chemistry Services Business of the Seller which provides services and developsand manufactures active ingredients, advanced intermediates, regulatory starting materials and functional excipients for thepharmaceutical, nutraceutical and agrochemical industries, as well as intermediates and finished catalysts for specialtychemical synthesis and together with the operations of that business located in Tyrone, Pennsylvania and South Haven,Michigan. Notwithstanding the preceding sentence, “Business” shall not, in any case, include the business of researching,developing, manufacturing, producing, having made or produced, marketing or selling (or providing services related to theforegoing) flame retardants, oilfield and drilling-related chemicals or products, lithium or lithium-containing products,bromine or bromine-containing products, cesium and cesium-containing products, halogens or halogen-containing products,aluminum or aluminum-containing products, catalysts, catalyst precursors, catalyst components, catalyst supports, catalystintermediates, catalyst activators, catalyst additives or their components, metallocenes or their components, zeolites or theircomponents, metal organics, products or catalysts used in the Metal Organic Chemical Vapor Deposition (MOCVD) process,sorbents or their intermediates precursors or delivery systems, polymer additives, heat stabilizers, curatives, cure promotersor chain extenders, or orthoalkylated intermediates for pesticides including diethylaniline (DEA) and methyl- ethylaniline(MEA) (the “Excluded Products”), the processes used to manufacture the Excluded Products, or the uses of ExcludedProducts.

Section 1.21 Business Day.

“Business Day” means any day that is not a Saturday, a Sunday or other day on which banks are required orauthorized by Law to be closed in the City of New York.

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Section 1.22 Business Employee.

“Business Employee” means each employee, independent contractor, or other service provider of the Seller orany of its Affiliates who (i) is employed or retained by the Seller or any of its Subsidiaries or Affiliates at the ManufacturingFacilities primarily in connection with the Business and is identified on Section 3.10(a) of the Seller Disclosure Schedule, or(ii) is otherwise employed or retained by the Seller or any of its Subsidiaries or Affiliates primarily in connection with theBusiness and is identified on Section 3.10(a) of the Seller Disclosure Schedule.

Section 1.23 Business Products.

“Business Products” shall have the meaning set forth in Section 3.20.

Section 1.24 CARES Act.

“CARES Act” means the Coronavirus Aid, Relief, and Economic Security Act of 2020, as amended, and anysimilar or successor Law or any administrative or other guidance published with respect thereto by any GovernmentalAuthority.

Section 1.25 Closing.

“Closing” shall have the meaning set forth in Section 2.7.

Section 1.26 Closing Date.

“Closing Date” shall have the meaning set forth in Section 2.7.

Section 1.27 Closing Date Employees.

“Closing Date Employees” shall have the meaning set forth in Section 5.8(a).

Section 1.28 Closing Date Cash Payment.

“Closing Date Cash Payment” means an amount equal to the sum of the Purchase Price, plus the PreliminaryNet Working Capital minus the Baseline Net Working Capital.

Section 1.29 Code.

“Code” means the Internal Revenue Code of 1986, as amended.

Section 1.30 Common Interests.

“Common Interests” shall have the meaning set forth in Section 4.8.

Section 1.21 Confidential Information.

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“Confidential Information” shall have the meaning set forth in the Confidentiality Agreement.

Section 1.32 Confidentiality Agreement.

“Confidentiality Agreement” shall have the meaning set forth in Section 5.3(a).

Section 1.33 Confidential Management Presentation.

“Confidential Management Presentation” means the Project Eagle Management Presentation dated January2020 provided to the Purchaser in connection with the transactions contemplated by this Agreement.

Section 1.34 Consultant.

“Consultant” shall have the meaning set forth in Section 8.7(a).

Section 1.35 Contract.

“Contract” means any written or oral contract (including unwritten undertakings or practices based on anycourse of dealing), subcontract, agreement, lease, license, note, mortgage, indenture, deed of trust, commitment, sale orpurchase order and any other instrument or agreement of any kind, and any amendments or supplements thereto.

Section 1.36 Contribution.

“Contribution” shall have the meaning set forth in the Recitals.

Section 1.37 control.

“control” (including the terms “controlled by” and “under common control with”), with respect to therelationship between or among two or more Persons, means the possession, directly or indirectly, or as trustee, personalrepresentative or executor, of the power to direct or cause the direction of the affairs or management of a Person, whetherthrough the ownership of voting securities, as trustee, personal representative or executor, by contract or otherwise.

Section 1.38 Cooperation Indemnitees

.

“Cooperation Indemnitees” shall have the meaning set forth in Section 5.13(b).

Section 1.39 COVID Actions.

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“COVID Actions” means any commercially reasonable actions that the Seller reasonably determines arenecessary to take in relation to the Business to (a) comply with any quarantine, “shelter in place”, “stay at home”, workforcereduction, social distancing, shut down, closure, sequester or any other Law or Governmental Order adopted in response toCOVID-19 applicable to the Business or the Manufacturing Facilities, (b) reduce the risk of exposure to or spread ofCOVID-19 at the Manufacturing Facilities and other facilities of the Seller and its Subsidiaries at which the Businessoperates, or (c) reduce the risk of environmental or safety issues resulting from a Manufacturing Facility not having sufficientqualified personnel to continue operations due to an outbreak of, or exposure to, COVID-19.

Section 1.40 Current Employees.

“Current Employees” shall have the meaning set forth in Section 5.8(a).

Section 1.41 De Minimis Claim.

“De Minimis Claim” shall have the meaning set forth in Section 8.4(b).

Section 1.42 Disclosure Schedules.

“Disclosure Schedules” means the Seller Disclosure Schedule and the Purchaser Disclosure Schedule, each ofwhich forms a part of this Agreement.

Section 1.43 Debt Commitment Letter.

“Debt Commitment Letter” shall have the meaning set forth in Section 4.6(a).

Section 1.44 Debt Financing.

“Debt Financing” shall have the meaning set forth in Section 4.6(a).

Section 1.45 Debt Financing Agreements.

“Debt Financing Agreements” shall have the meaning set forth in Section 4.6(a).

Section 1.46 Dispute Notice.

“Dispute Notice” shall have the meaning set forth in Section 2.11(c).

Section 1.47 Disputed Items.

“Disputed Items” shall have the meaning set forth in Section 2.11(c).

Section 1.48 Drug Laws.

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“Drug Laws” means any Law related to the business of processing, manufacturing, labeling, distributing andselling any drug or drug component, including, but not limited to active pharmaceutical ingredients, meant for human oranimal use, and any rule, regulation, directive, order, guidance or decision promulgated or issued pursuant thereto andapplicable to the Seller or any of its Subsidiaries. For the avoidance of doubt, Drug Laws shall include the FDCA and 21C.F.R. Parts 210 and 211 promulgated thereunder and the Chemical Diversion and Trafficking Act and any regulationspromulgated thereunder.

Section 1.49 Employee Records.

“Employee Records” means all job application, background check, training, personnel, discipline,performance (including all performance evaluations for each of the last three performance years), employee compensation,work authorization (including I-9, visas, work permits, employment passes, and other legal or regulatory documentation),medical and benefits and labor relations documents and records relating to the employment of the Business Employees.

Section 1.50 Encumbrance.

“Encumbrance” means any security interest, pledge, hypothecation, mortgage, lien, encumbrance, license,easement, right of way, servitude, lease or sublease, deed of trust, option, right of first refusal, attachment, levy, charge,claim, imposition, conditional sale or title retention arrangement or other restriction of any kind or any other interest inproperty or assets (or the income or profits therefrom), whether consensual or nonconsensual and whether arising by Contractor under any Law or otherwise.

Section 1.51 Environmental Law.

“Environmental Law” means any Law relating to human health or the environment; human or environmentalexposure to any Hazardous Material or employee or occupational safety, including, but not limited to, Mich. Comp. Laws §§324.20101 to 324.20142 and Act 2.

Section 1.52 Environmental Losses.

“Environmental Losses” shall have the meaning set forth in Section 8.7(h).

Section 1.53 Environmental Permit.

“Environmental Permit” means any permit, approval, identification number, registration, notification, licenseor other authorization that the Business is required to possess or obtain pursuant to any applicable Environmental Law withrespect to the Business or the Manufacturing Facilities.

Section 1.54 Equipment.

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“Equipment” means the machinery, equipment, furniture, fixtures, furnishings, parts, spare parts, tools,supplies, leasehold improvements, vehicles and other tangible property that is owned or leased by the Seller or any of itsSubsidiaries (wherever located and whether or not carried on Seller’s or any of its Subsidiaries’ books), together with anyexpress or implied warranty by the manufacturer, seller or lessor of any item or component thereof, and any maintenancerecords or other documentation relating thereto, in each case, that is primarily used or held for use in the Business, butexcluding those items set forth on Section 1.54 of the Seller Disclosure Schedule.

Section 1.55 ERISA.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

Section 1.56 ESA.

“ESA” means an environmental site assessment.

Section 1.57 Estimated Purchase Price Statement.

“Estimated Purchase Price Statement” shall have the meaning set forth in Section 2.10.

Section 1.58 Excluded Assets.

“Excluded Assets” shall have the meaning set forth in Section 2.1(b).

Section 1.59 Excluded Claim.

“Excluded Claim” means all claims related to any Action that the Seller has or may have against third parties,solely to the extent such claim is not primarily related to the Business, the Transferred Assets or the Assumed Liabilities orprimarily arises from, or relates to, the Excluded Assets or Excluded Liabilities.

Section 1.60 Excluded Liabilities.

“Excluded Liabilities” shall have the meaning set forth in Section 2.2(b).

Section 1.61 Excluded Taxes.

“Excluded Taxes” means, without duplication, all Taxes for, attributable to, or with respect to, any Pre-Closing Tax Period (including any Taxes that are allocable under Section 6.1 to a Pre-Closing Tax Period), any Taxesattributable to any deferred revenue or prepaid amount received prior to the Closing by the Seller with respect to theBusiness, the Seller’s share of Transfer Taxes pursuant to Section 6.3 and any payroll

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Taxes attributable to any Pre-Closing Tax Period that the Seller or any of its Subsidiaries has elected to defer pursuant to theCARES Act.

Section 1.62 Existing Stock.

“Existing Stock” shall have the meaning set forth in Section 5.5(b).

Section 1.63 FDA.

“FDA” means the United States Food and Drug Administration.

Section 1.64 FDCA.

“FDCA” means the United States Federal Food, Drug, and Cosmetic Act.

Section 1.65 FDCA Debarment List.

“FDCA Debarment List” means a public list of firms or persons currently debarred pursuant to sections 306(a)or (b) of the FDCA.

Section 1.66 Final Net Working Capital.

“Final Net Working Capital” shall have the meaning set forth in Section 2.11(a).

Section 1.67 Final Phase II Reports.

“Final Phase II Report” shall have the meaning set forth in Section 8.7(a).

Section 1.68 Financial Statements.

“Financial Statements” means the combined carve-out statements of income of the Business set forth inSection 1.68 of the Seller Disclosure Schedule.

Section 1.69 Financing Sources

.

“Financing Sources” means each party to the Debt Financing Agreements and any other lender, agent, leadarranger, arranger, administrative agent, collateral agent or any other agent in respect of the Debt Financing (including anyAlternative Financing) and any Affiliates and Representatives of any of the foregoing.

Section 1.70 GAAP.

“GAAP” means United States generally accepted accounting principles applied on a basis consistent with theSeller’s audited financial statements.

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Section 1.71 Goodwill.

“Goodwill” means the goodwill of the Seller and its Subsidiaries related to, associated with or attributable tothe Business.

Section 1.72 Governmental Authority.

“Governmental Authority” means any federal, national, foreign, domestic, supranational, state, provincial,municipal, local or other government, governmental, quasi-governmental, regulatory, self-regulatory, national stockexchange or administrative authority, agency, commission, branch, department, official or entity or any court of competentjurisdiction or arbitrator.

Section 1.73 Governmental Order.

“Governmental Order” means any order, writ, judgment, injunction, decree, stipulation, determination oraward entered by or with any Governmental Authority.

Section 1.74 Hazardous Material.

“Hazardous Material” means petroleum and petroleum products, by-products or breakdown products, lead,radon, radioactive materials, asbestos-containing materials, polychlorinated biphenyls, pesticides, per- and polyfluoroalkylsubstances, and dangerous or toxic organisms (including Legionella and Stachybotrys species) to the extent such organismsare regulated by any Governmental Authority under applicable Environmental Laws; or any other chemicals, materials,wastes or substances defined or regulated by any Governmental Authority under applicable Environmental Laws as orincluded in the definition of “toxic substances,” “hazardous wastes,” “hazardous substances,” “pollutants,” “contaminants”,“hazardous materials” or similar substances.

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Section 1.75 HSR Act.

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules andregulations promulgated thereunder.

Section 1.76 Indebtedness.

“Indebtedness” of any Person means, without duplication, all obligations of such Person for borrowed money, all obligations of such Person evidenced by any note, bond, debenture, other debt security or similar instruments, all leaseobligations of such Person which are required to be capitalized in accordance with GAAP, all interest rate or currencyobligations of such Person, including swaps, hedges or similar agreements, all obligations of such Person evidenced byletters of credit, surety bonds, bank guarantees and similar instruments (to the extent drawn), all obligations of such Personin respect of accrued but unpaid dividends, all obligations of such Person in respect of the deferred purchase price of goods,equity or services, including earn-outs, contingent payments or similar arrangements, all guarantees, direct or indirect, bysuch Person of any of the items set forth in clauses (a) - (g) of any other Person and with respect to each of the foregoing, theoutstanding principal amount plus all unpaid interest, breakage costs, prepayment or redemption penalties or premiums, orother unpaid fees, expenses or obligations owed in respect of the acceleration, termination or cancellation thereof.

Section 1.77 Indemnified Party.

“Indemnified Party” means a Purchaser Indemnified Party or a Seller Indemnified Party, as the case may be.

Section 1.78 Indemnifying Party.

“Indemnifying Party” means the Seller pursuant to Section 8.2 or the Purchaser pursuant to Section 8.3, as thecase may be.

Section 1.79 Independent Accountant.

“Independent Accountant” means Ernst & Young (or, if such firm shall decline or is unable to act, anothernationally recognized firm with expertise in accounting matters reasonably acceptable to the Seller and the Purchaser).

Section 1.80 In-Licensed Intellectual Property.

“In-Licensed Intellectual Property” means all Intellectual Property that the Seller or any of its Subsidiaries islicensed or otherwise authorized to use pursuant to the Transferred IP Agreements.

Section 1.81 Intellectual Property.

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“Intellectual Property” means all of the following rights in any jurisdiction throughout the world: patents andpatent applications, and all related continuations, continuations in part, divisionals, reissues, reexaminations, substitutionsand extensions thereof, utility models and utility model applications, and industrial designs; trademarks, service marks, tradenames, logos, trade dress and internet domain names, social media names, together with the goodwill connected with the usethereof and symbolized thereby; copyrights, including copyrights in computer software; registrations and applications forregistration of any of the foregoing under clauses (a) – (c) of this definition; trade secrets, know-how, formulae, methods,techniques, processes (including manufacturing processes), invention disclosures and conception records, and otherconfidential and proprietary information; and the right to sue at law or in equity for all claims or causes of action arising outof or related to any past, present or future infringement, misappropriation or violation of any of the foregoing, including theright to receive all proceeds and damages therefrom.

Section 1.82 Intellectual Property Assignment Agreement.

“Intellectual Property Assignment Agreement” means the Intellectual Property Assignment Agreement, to beentered into by the Purchaser and the Seller as of the Closing Date, substantially in the form attached hereto as Exhibit B.

Section 1.83 Intended Tax Treatment.

“Intended Tax Treatment” shall have the meaning set forth in Section 6.5.

Section 1.84 IP Agreements.

“IP Agreements” means all Contracts concerning Intellectual Property or IT Assets to which the Seller or anyof its Subsidiaries is a party or beneficiary or by which the Seller or any of its Subsidiaries, or any of its or their properties orassets, may be bound, including all (a) licenses of Intellectual Property by the Seller or any of its Subsidiaries to any Person,(b) licenses of Intellectual Property by any Person to the Seller or any of its Subsidiaries, (c) Contracts between any Personand the Seller or any of its Subsidiaries relating to the transfer, development, maintenance or use of Intellectual Property orIT Assets, and (d) consents, settlements, decrees, orders, injunctions, judgments or rulings governing the use, validity orenforceability of Intellectual Property or IT Assets.

Section 1.85 IRS.

“IRS” means the Internal Revenue Service.

Section 1.86 IT Assets.

“IT Assets” means software (together with its configuration and customization), systems, servers, computers,hardware, firmware, middleware, networks,

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data communications lines, routers, hubs, switches and all other information technology equipment, and all associateddocumentation.

Section 1.87 Key Customer.

“Key Customer” shall have the meaning set forth in Section 3.15(a).

Section 1.88 Key Distributors.

“Key Distributors” shall have the meaning set forth in Section 3.15(c).

Section 1.89 Key Supplier.

“Key Supplier” shall have the meaning set forth in Section 3.15(b).

Section 1.90 Law.

“Law” means any statute, law, ordinance, regulation, rule, code, requirement, international treaty orconvention or rule of law (including common law requirement or rule), international treaties or conventions or otherrequirement with similar effect promulgated or issued by any Governmental Authority or any Governmental Order.

Section 1.91 Leave Employees.

“Leave Employees” shall have the meaning set forth in Section 5.8(a).

Section 1.92 Liabilities.

“Liabilities” means any and all debts, liabilities, claims, demands, expenses, guarantees, commitments orobligations of any kind, character or nature whatsoever, whether direct or indirect, accrued or unaccrued, fixed or variable,known or unknown, absolute or contingent, asserted or unasserted, matured or unmatured or determined or determinable, dueor to become due, including those arising under any Law, Action or Governmental Order and those arising under anyContract.

Section 1.93 Local Conveyance Documents.

“Local Conveyance Documents” means the Assignment and Assumption Agreement and Bill of Sale, Deed ofTransfer of Owned Real Property (Tyrone) and Deed of Transfer of Owned Real Property (South Haven), in substantially theforms of Exhibits A-1 through A-3.

Section 1.94 Loss.

“Loss” shall have the meaning set forth in Section 8.2.

Section 1.95 Manufacturing Facilities.

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“Manufacturing Facilities” means the manufacturing facilities of the Business located on the Owned RealProperty in South Haven, Michigan and Tyrone, Pennsylvania.

Section 1.96 Marketing Period

.

“Marketing Period” means the “Marketing Period” as defined in the Debt Commitment Letter.

Section 1.97 Material Adverse Effect.

“Material Adverse Effect” means any event, circumstance, condition, state of facts, change or effect, that (i)is, or would reasonably be expected to be, materially adverse to the assets, liabilities, business, results of operations or thefinancial condition of the Business, taken as a whole or (ii) would reasonably be expected to prevent or materially delay theability of the Seller to perform its obligations under this Agreement or to consummate the transactions contemplated hereby;provided, however, that none of the following, either alone or in combination, shall be deemed to constitute a “MaterialAdverse Effect”, or be taken into account in determining, whether there has been a “Material Adverse Effect” for purposes ofclause (i): events, circumstances, changes or effects that generally affect the industries or segments thereof in which theBusiness operates, including legal and regulatory changes and changes in the price of commodities or raw materials; generalbusiness, economic or political conditions (or changes therein); events, circumstances, changes or effects generally affectingthe financial, credit or securities markets in the United States or in any other country or region in the world, includingchanges in interest rates or foreign exchange rates; events, circumstances, changes or effects arising out of, or attributable to,the public announcement of the execution of this Agreement or the other Transaction Documents, any actions taken or nottaken by the Seller in accordance with the express requirements of this Agreement (other than Section 5.1) or the otherTransaction Documents, or actions taken or not taken by the Seller at the written request of the Purchaser or any publiccommunication by the Purchaser in respect of plans or intentions with respect to the Business or Business Employees; events, circumstances, changes or effects arising out of, or attributable to, strikes, slowdowns, lockouts or work stoppages(pending or threatened); events, circumstances, changes or effects arising out of, or attributable to, acts of armed hostility,sabotage, terrorism or war (whether or not declared), including any escalation or worsening thereof; events, circumstances,changes or effects arising out of, or attributable to, earthquakes, hurricanes, tsunamis, tornadoes, floods, mudslides or othernatural disasters, weather-related conditions, explosions or fires; events, circumstances, changes or effects arising out of, orattributable to, changes or modifications in GAAP, or applicable Law after the date hereof; events, circumstances, changesor effects arising out of, or attributable to, an epidemic, pandemic or disease outbreak (including the COVID-19 virus) andincluding the taking of any COVID Action; or the failure, in and of itself, by the Business to meet any internal or otherestimates, expectations, forecasts,

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plans, projections or budgets for any period; provided, that, with respect to a matter described in clauses (a), (b), (c), (f), (g),(h), (i) and (j) such matter shall be deemed to constitute a “Material Adverse Effect”, or shall be taken into account indetermining whether there has been a “Material Adverse Effect”, to the extent it has a disproportionate adverse effect on theBusiness relative to other comparable businesses operating in the industries in which the Business operates.

Section 1.98 Material Contracts.

“Material Contracts” shall have the meaning set forth in Section 3.13(a).

Section 1.99 Most Cost-Effective Manner.

“Most Cost-Effective Manner” shall have the meaning set forth in Section 8.7(c)(iii).

Section 1.100 Net Working Capital.

“Net Working Capital” means, as of 12:01 a.m. New York time on the Closing Date, the amount that is thedifference between the current assets of the Business identified as line items on Section 1.100 of the Seller DisclosureSchedule (excluding cash and cash equivalents) and the current liabilities of the Business identified as line items on Section1.100 of the Seller Disclosure Schedule (excluding trade payables).

Section 1.101 Non-Transferred Environmental Permit.

“Non-Transferred Environmental Permit” shall have the meaning set forth in Section 5.4(b).

Section 1.102 Owned Real Property.

“Owned Real Property” means the real property identified in Section 1.102 of the Seller Disclosure Schedule,together with all buildings, improvements and fixtures thereon and all easements, rights-of-way, licenses, rights to use realproperty, appurtenances and other rights and benefits associated with such land and together with all improvements, fixturesand other rights and appurtenants thereto.

Section 1.103 Permits.

“Permits” means all permits, licenses, franchises, certificates of occupancy, qualifications, orders, agreementsand authorizations issued by any Governmental Authority, including Environmental Permits.

Section 1.104 Permitted Encumbrances.

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“Permitted Encumbrances” means statutory liens for current Taxes not yet due or delinquent (or the validityor amount of which is being contested in good faith by appropriate proceedings and for which adequate reserves have beenestablished in the Financial Statements); mechanics’, materialmens’, carriers’, workers’, repairers’, landlords’ and otherEncumbrances or security obligations arising by operation of Law, or pledges, deposits or other Encumbrances securing theperformance of bids, trade contracts, leases or statutory obligations (including workers’ compensation, unemploymentinsurance or other social security legislation), in each case incurred in the ordinary course of business consistent with pastpractice, and for amounts which are not yet due or delinquent and which are not material; Encumbrances arising underconditional sales contracts and equipment leases with third parties; variations, if any, between tax lot lines and propertylines; minor deviations, if any, of fences or shrubs from designated property lines; Encumbrances identified on Section1.104 of the Seller Disclosure Schedule; any zoning, entitlement, conservation restriction and other land use andenvironmental regulations, in each case, imposed by Governmental Authorities and which are not violated by the current useor occupancy of such real property or the operation of the Business thereon; Encumbrances that will be released and fullydischarged at or prior to the Closing; (i) all covenants, conditions, restrictions, easements, charges, rights of way, otherEncumbrances and other similar matters of record set forth in any local or municipal recording or like office; and (j) anymatter appearing in the Title Commitment or that can be determined by a Survey of the Owned Real Property, in each casenot otherwise in the nature of the liens addressed elsewhere in this definition and that do not, individually or in the aggregate,materially impair the use of the Owned Real Property to which they apply.

Section 1.105 Person.

“Person” means any individual, partnership, firm, corporation, limited liability company, association, trust,unincorporated organization or other entity, as well as any syndicate or group that would be deemed to be a person underSection 13(d)(3) of the Securities Exchange Act of 1934, as amended.

Section 1.106 Plan.

“Plan” means each (i) “employee benefit plan” as defined in Section 3(3) of ERISA, whether or not subject toERISA, (ii) employment, consulting, severance, change in control, transaction bonus, retention or other similar agreement orplan or (iii) other plan, agreement or arrangement providing for compensation, bonuses, equity or equity-basedcompensation, incentives, deferred compensation, severance, change in control, health, medical, dental, vision, life insurance,welfare, fringe benefits, perquisites, disability or sick leave benefits, supplemental unemployment benefits, post-employmentor retirement or other benefits, in each case that is sponsored, maintained, administered, or contributed to by any Person orany of its Affiliates, or with respect to which the Person or any of its Affiliates is a party, for the benefit of any current orformer employee, director or independent contractor of the Person or any of its Affiliates, and/or

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their spouses, dependents or beneficiaries, or with respect to which the Person or any of its Affiliates has any Liabilitiescontingent or otherwise.

Section 1.107 Pollution Policy.

“Pollution Policy” shall have the meaning set forth in Section 7.2(d).

Section 1.108 Post-Closing Adjustment.

“Post-Closing Adjustment” shall have the meaning set forth in Section 2.11(a).

Section 1.109 Post-Closing Tax Period.

“Post-Closing Tax Period” means any Tax period beginning after the Closing Date, and the portion of anyStraddle Period beginning after the Closing Date.

Section 1.110 Post-Signing Insurance Proceeds.

“Post-Signing Insurance Proceeds” shall have the meaning set forth in Section 2.1(a)(vii).

Section 1.111 Pre-Closing IT Integration Completion

.

“Pre-Closing IT Integration Completion” shall have the meaning set forth in Section 5.6(d).

Section 1.112 Pre-Closing Tax Period.

“Pre-Closing Tax Period” means any Tax period ending on or prior to the Closing Date, and the portion of anyStraddle Period ending on or prior to the Closing Date.

Section 1.113 Preferred Equity.

“Preferred Equity” means 2,700 Preferred Units having an aggregate Preferred Unit Face Value of$270,000,000, which Preferred Units are to be issued to the Seller in connection with the Contribution.

Section 1.114 Preferred Issuance.

“Preferred Issuance” shall have the meaning set forth in the Recitals.

Section 1.115 Preferred Unit Face Value.

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“Preferred Unit Face Value” has the meaning set forth in the SPV Operating Agreement.

Section 1.116 Preferred Units.

“Preferred Units” has the meaning set forth in the SPV Operating Agreement.

Section 1.117 Preliminary Net Working Capital.

“Preliminary Net Working Capital” shall have the meaning set forth in Section 2.10.

Section 1.118 Protected Communications.

“Protected Communications” shall have the meaning set forth in Section 5.9.

Section 1.119 Public Announcement.

“Public Announcement” shall have the meaning set forth in Section 11.4.

Section 1.120 Purchase Price.

“Purchase Price” shall have the meaning set forth in Section 2.1(a).

Section 1.121 Purchaser.

“Purchaser” shall have the meaning set forth in the Preamble.

Section 1.122 Purchaser 401(k) Plan.

“Purchaser 401(k) Plan” shall have the meaning set forth in Section 5.8(j).

Section 1.123 Purchaser Benefit Plan.

“Purchaser Benefit Plan” means any Plan to which the Purchaser or any Affiliate is a party, or with respect towhich the Purchaser or any Affiliate has any Liabilities or that are maintained, contributed to or sponsored by the Purchaseror any Affiliate, in each case for the benefit of any current or former employees, directors or independent contractors of thePurchaser or any Affiliate and/or their spouses, dependents or beneficiaries.

Section 1.124 Purchaser DC Plan Contributions.

“Purchaser DC Plan Contributions” means all employer contributions that are required to be made by thePurchaser or one of its Affiliates under any Purchaser

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Benefit Plan that is a tax-qualified defined contribution plan with respect to amounts deemed to be “eligible compensation”thereunder.

Section 1.125 Purchaser Disclosure Schedule.

“Purchaser Disclosure Schedule” means the Disclosure Schedule delivered by the Purchaser to the Seller inconnection with this Agreement.

Section 1.126 Purchaser Environmental Liabilities.

“Purchaser Environmental Liabilities” means any Liability or Loss to the extent relating to, or arising out of,any Releases of Hazardous Materials at, in, on or from any Manufacturing Facility or Owned Real Property on or after theClosing Date; any Releases of Hazardous Materials at any third-party site to which such Hazardous Materials weretransported or disposed of, or arranged for the transportation or disposal of, from any Manufacturing Facility or Owned RealProperty or otherwise in connection with the Business on or after the Closing Date; any exposure on or after the Closing Dateto Hazardous Materials in connection with the operation of the Business at any Manufacturing Facility or Owned RealProperty or to any Hazardous Material included in any product or material manufactured, marketed, sold or distributed on orafter the Closing Date from any Manufacturing Facility or Owned Real Property; any act or omission on or after the ClosingDate in connection with the Business, the Manufacturing Facilities or any Owned Real Property, including the manufacture,marketing, sale or distribution of products by the Business on or after the Closing Date, that results in a violation of, orfailure to comply with, any applicable Environmental Laws or Environmental Permit; and any Action under anyEnvironmental Law or Environmental Permit brought with respect to environmental conditions arising on or after the ClosingDate at any Manufacturing Facility or Owned Real Property (for the avoidance of doubt, “Purchaser EnvironmentalLiabilities” shall not include any Seller Environmental Liabilities set forth in Section 1.151 except as otherwise set forth inSection 8.7).

Section 1.127 Purchaser FSA Plan.

“Purchaser FSA Plan” shall have the meaning set forth in Section 5.8(f).

Section 1.128 Purchaser Fundamental Representations.

“Purchaser Fundamental Representations” shall have the meaning set forth in Section 8.1.

Section 1.129 Purchaser Indemnified Party.

“Purchaser Indemnified Party” shall have the meaning set forth in Section 8.2.

Section 1.130 Purchaser-Owned IP

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.

“Purchaser-Owned IP” shall have the meaning set forth in the Recitals.

Section 1.131 Registered Intellectual Property.

“Registered Intellectual Property” means all the following rights issued by, registered or filed with, renewedby or the subject of a pending application before any Governmental Authority or Internet domain name registrar in anyjurisdiction throughout the world: (a) patents and patent applications, and all related continuations, continuations-in-part,divisionals, reissues, reexaminations, substitutions and extensions thereof; (b) registered trademarks, service marks, andinternet domain names or other registrations related to trademarks, or applications related thereto; (c) registered copyrightsand applications for copyright registration.

Section 1.132 Related Party.

“Related Party” means, with respect to any Person, such Person’s Affiliates and its and their respective currentand former directors, officers and controlling persons.

Section 1.133 Related Party Contract.

“Related Party Contract” means any Contract between the Seller or any of its Subsidiaries, on the one hand,and a Related Party of any such Person, on the other hand.

Section 1.134 Release.

“Release” means disposing, discharging, injecting, spilling, leaking, pumping, pouring, leaching, dumping,emitting, escaping, or emptying into or onto the environment including upon any soil, sediment, subsurface strata, surfacewater, or groundwater, whether sudden or non-sudden and whether accidental or non-accidental, or any release, emission ordischarge as those terms are defined in any applicable Environmental Law.

Section 1.135 Remedial Action.

“Remedial Action” means any action required by a Governmental Authority to investigate, clean up, remove,remediate, monitor, or assess, or conduct remedial or corrective actions with respect to, any Release of Hazardous Materials.

Section 1.136 Representatives.

“Representatives” means with respect to any Person, such Person’s Affiliates and its and their respectivedirectors, officers, employees, agents and advisors.

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Section 1.137 Required Information

.

“Required Information” means all information regarding the business, operations and financial condition ofthe Business, the Seller and its Subsidiaries that is reasonably requested by the Purchaser and that is customarily included inmarketing materials for indebtedness of the type to be provided under the Debt Financing Agreements, including all financialand company information regarding the Business, the Seller and its Subsidiaries that is required by the Debt FinancingAgreements (including, if applicable, any debt commitment letters in connection with any Alternative Financing); providedthat the only financial information that the Seller shall provide, if requested, shall be as set forth on Section 1.137 of theSeller Disclosure Schedule.

Section 1.138 Retained Names and Marks.

“Retained Names and Marks” shall have the meaning set forth in Section 5.5(a).

Section 1.139 Retention Agreement Recipients.

“Retention Agreement Recipients” mean the individuals set forth on Section 1.139 of the Seller DisclosureSchedule.

Section 1.140 Retention Agreements.

“Retention Agreements” mean the retention agreements of the Seller pursuant to which the RetentionAgreement Recipients shall be entitled to receive cash bonuses in connection with the transactions contemplated by thisAgreement payable after the Closing Date by the Purchaser or one of its Subsidiaries or Affiliates pursuant to the termsthereof, and the terms of this Agreement.

Section 1.141 Return Deadline.

“Return Deadline” shall have the meaning set forth in Section 5.8(a).

Section 1.142 Sale and Purchase.

“Sale and Purchase” shall have the meaning set forth in the Recitals.

Section 1.143 Sales Contracts.

“Sales Contracts” shall have the meaning set forth in Section 3.13(a)(ii).

Section 1.144 Sales Agreements.

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“Sales Agreements” means the sales agreements to be entered by the Purchaser and the Seller as of theClosing Date, substantially in the forms attached hereto as Exhibits C-1 and C-2.

Section 1.145 Sanctions.

“Sanctions” shall have the meaning set forth in Section 3.7(b).

Section 1.146 Securities Act.

“Securities Act” shall have the meaning set forth in Section 3.25(a).

Section 1.147 Seller.

“Seller” shall have the meaning set forth in the Preamble.

Section 1.148 Seller 401(k) Plan.

“Seller 401(k) Plan” shall have the meaning set forth in Section 5.8(j).

Section 1.149 Seller Benefit Plan.

“Seller Benefit Plan” means any Plan to which the Seller or any Subsidiary or Affiliate is a party, or withrespect to which the Seller or any Subsidiary thereof has any Liabilities or that are maintained, contributed to or sponsored bythe Seller or any Subsidiary or Affiliate thereof, in each case for the benefit of any Business Employees and/or their spouses,dependents or beneficiaries.

Section 1.150 Seller Disclosure Schedule.

“Seller Disclosure Schedule” means the Disclosure Schedule delivered by the Seller to the Purchaser inconnection with this Agreement.

Section 1.151 Seller Environmental Liabilities.

“Seller Environmental Liabilities” means all Liabilities or Losses to the extent arising from or related to thepresence or any Releases of Hazardous Materials at, in, on or from the Manufacturing Facility or Owned Real Propertylocated in South Haven, Michigan prior to the Closing Date; any Releases of Hazardous Materials at any third-party site towhich such Hazardous Materials were transported or disposed of, or arranged for the transportation or disposal of, by theSeller from any Manufacturing Facility or Owned Real Property or otherwise in connection with the Business prior to theClosing Date; any exposure prior to the Closing Date (i) to Hazardous Materials in connection with the Seller’s operation ofthe Business at any Manufacturing Facility or Owned Real Property or (ii) to any Hazardous Material included in anyproduct or material manufactured, marketed, sold or distributed prior to the Closing Date by the Seller from anyManufacturing Facility or Owned Real Property or by the Business; and

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any act or omission by the Seller prior to the Closing Date in connection with the Business, the Manufacturing Facilities orany Owned Real Property, including the manufacture, marketing, sale or distribution of products by the Business prior to theClosing Date, that has resulted in or results in a violation of, or failure to comply with, any applicable Environmental Laws orEnvironmental Permit.

Section 1.152 Seller FSA Plan.

“Seller FSA Plan” shall have the meaning set forth in Section 5.8(f).

Section 1.153 Seller Fundamental Representations.

“Seller Fundamental Representations” shall have the meaning set forth in Section 8.1.

Section 1.154 Seller Indemnified Party.

“Seller Indemnified Party” shall have the meaning set forth in Section 8.3.

Section 1.155 Seller Indemnified Remedial Action or Environmental Noncompliance.

“Seller Indemnified Remedial Action or Environmental Noncompliance” shall have the meaning set forth inSection 8.7(i).

Section 1.156 Seller’s Knowledge; Knowledge of the Seller.

“Seller’s Knowledge”, “Knowledge of the Seller” or any similar term used in this Agreement means the actual(but not constructive or imputed) knowledge, after reasonable inquiry of the employees of the Seller or its Subsidiariesresponsible for the relevant subject matter (including the head of intellectual property of the Seller) of the Persons identifiedon Section 1.156 of the Seller Disclosure Schedule.

Section 1.157 Seller Restricted Parties.

“Seller Restricted Parties” shall have the meaning set forth in Section 5.3(c).

Section 1.158 Shared Contracts.

“Shared Contract” means any Contract to which the Seller or any of its Subsidiaries is a party for theprovision of goods and/or services that are used in both the Business and any other businesses (other than the Business) ofthe Seller and its Subsidiaries, all of which are set forth in Section 3.13(a)(xiv) of the Seller Disclosure Schedule.

Section 1.159 Shared Information.

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“Shared Information” shall have the meaning set forth in Section 5.3(c).

Section 1.160 SPV.

“SPV” shall have the meaning set forth in the Preamble.

Section 1.161 SPV Operating Agreement.

“SPV Operating Agreement” means the Amended and Restated Limited Liability Company Agreement of theSPV, substantially in the form attached hereto as Exhibit D.

Section 1.162 Straddle Period.

“Straddle Period” means any Tax period beginning on or prior to, and ending after, the Closing Date.

Section 1.163 Subsidiary.

“Subsidiary” of any Person means any corporation, partnership, limited liability company or otherorganization, whether incorporated or unincorporated, which is controlled, directly or indirectly, by such Person.

Section 1.164 Survey.

“Survey” shall have the meaning set forth in Section 5.12.

Section 1.165 Tax; Taxes.

“Tax” or “Taxes” means any federal, state local, or non-U.S. income, gross receipts, license, payroll,employment, excise, severance, stamp, occupation, premium, windfall profits, environmental, customs duties, capital stock,franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, sales,use, transfer, registration, value added alternative or add-on minimum, estimated or other tax, duty, impost, tariff, assessmentor other similar charge in the nature of a tax imposed by any Governmental Authority, whether disputed or not, together withany interest, additions, charges or penalties in respect thereof.

Section 1.166 Tax Returns.

“Tax Returns” means any return, declaration, report, claim for refund, or information return or statementrelating to Taxes, including any schedule or attachment thereto, and including any amendment thereof required to be filedwith a Governmental Authority with respect to Taxes.

Section 1.167 Termination Date.

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“Termination Date” shall have the meaning set forth in Section 9.1(a).

Section 1.168 Third-Party Claim.

“Third-Party Claim” shall have the meaning set forth in Section 8.5(b).

Section 1.169 Third-Party Rights.

“Third-Party Rights” shall have the meaning set forth in Section 2.5(b).

Section 1.170 Title Commitment.

“Title Commitment” shall have the meaning set forth in Section 5.12(a).

Section 1.171 Title Insurance.

“Title Insurance” shall have the meaning set forth in Section 2.8(e).

Section 1.172 Title Insurer.

“Title Insurer” shall have the meaning set forth in Section 2.8(e).

Section 1.173 Title Policy.

“Title Policy” shall have the meaning set forth in Section 2.8(e).

Section 1.174 Trade Accounts Payable.

“Trade Accounts Payable” means all trade accounts payable of the Seller and its Subsidiaries and all accruedpayables of the Seller and its Subsidiaries for goods received from, but not invoiced by, vendors or suppliers, in each case,arising out of the operation of the Business prior to the Closing Date.

Section 1.175 Trade Controls.

“Trade Controls” shall have the meaning set forth in Section 3.7(b).

Section 1.176 Transaction Documents.

“Transaction Documents” means this Agreement, the Local Conveyance Documents, the Intellectual PropertyAssignment Agreement, the Sales Agreements, the SPV Operating Agreement, the Transition Services Agreement and anyother Contract entered into, or any other document or certificate delivered, in connection with this Agreement or any of theother Transaction Documents.

Section 1.177 Transfer Date.

“Transfer Date” shall have the meaning set forth in Section 5.8(a).

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Section 1.178 Transfer Taxes.

“Transfer Taxes” means any sales, use, transfer, conveyance, ad valorem, stamp, stamp duty, value added,recording or other similar tax, fee or charge imposed by any Governmental Authority upon the sale, transfer or assignment ofany Transferred Asset or any interest therein pursuant to this Agreement, or upon the recording of such sale, transfer orassignment, together with any interest, additions or penalties imposed in respect thereof.

Section 1.179 Transferred Accounts Receivable.

“Transferred Accounts Receivable” means all accounts receivable (other than from the Seller, or any of itsSubsidiaries), notes receivable, rebates receivable, employee advances and other miscellaneous receivables of the Seller orany of its Subsidiaries, in each case, arising out of the operation of the Business prior to the Closing Date and including anyunpaid fees and interest relating thereto.

Section 1.180 Transferred Assets.

“Transferred Assets” shall have the meaning set forth in Section 2.1(a).

Section 1.181 Transferred Contracts.

“Transferred Contracts” means the Contracts (other than Transferred IP Agreements) to which the Seller orany of its Subsidiaries is a party that are primarily related to the Business or any of the Transferred Assets, including thoseContracts identified on Section 1.181 of the Seller Disclosure Schedule.

Section 1.182 Transferred Employee.

“Transferred Employee” shall have the meaning set forth in Section 5.8(a).

Section 1.183 Transferred Information.

“Transferred Information” means originals of (or if originals are unavailable, copies of) all sales andpromotional literature, customer lists, prospective customer lists, correspondence and other sales-related materials, researchand development records, production records, service and warranty records, equipment logs, operation guides and manuals,studies, reports and personnel records, in each case, whether in hard copy or computer format, in each case to the extent usedor held for use in, or primarily related to, the Business and in the possession or control of the Seller or any of its Subsidiaries.

Section 1.184 Transferred Intellectual Property.

“Transferred Intellectual Property” means the Intellectual Property owned by the Seller or any of itsSubsidiaries, in each case, that is primarily used or held for use

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in the Business, including the Registered Intellectual Property identified on Section 3.8(a) of the Seller Disclosure Schedule.

Section 1.185 Transferred Inventory.

“Transferred Inventory” means all inventories, raw materials, packaging materials, work in process, semi-finished and finished goods, purchased supplies, other supplies and spare parts and materials used for maintaining productionmachinery and equipment, in each case, to the extent such inventories are owned, used or held for use by the Seller or any ofits Subsidiaries in, or are primarily related to, the Business.

Section 1.186 Transferred IP Agreements.

“Transferred IP Agreements” means all IP Agreements that are primarily related to the Business.

Section 1.187 Transferred IT Assets.

“Transferred IT Assets” means all IT Assets owned, used or held for use by Seller and its Subsidiaries that areprimarily related to the Business.

Section 1.188 Transferred Permits.

“Transferred Permits” means the Permits of the Seller or any of its Subsidiaries used or held for use in, orprimarily related to, the Business, including those set forth on Section 1.188 of the Seller Disclosure Schedule.

Section 1.189 Transferred Records.

“Transferred Records” means all books of account, general, financial, accounting, real property, records,invoices, customer records, shipping records, supplier lists, other distribution lists, Tax records, Employee Records (otherthan those that are prohibited by applicable Law from being transferred to the Purchaser, copies of which (to the extentpermitted by applicable Law) will be made available to the Purchaser upon Purchaser’s request), correspondence, documents,lists, plans, files related to Intellectual Property (including invention disclosures and conception records), financialstatements, internal audit or compliance reports, drug master files and similar documents, records, papers and files (and anysupporting documentation relating thereto) and other documents, records, papers and files, including all pending, interim andfinal analytical data, physical or chemical properties data, toxicological and environmental data and exposure-related data,and including all records required under applicable Environmental Laws, whether in hard copy or computer format, in eachcase, to the extent in the possession or control of the Seller or any of its Subsidiaries and used or held for use in, or related to,the Business, and including those documents set forth in Section 1.189 of the Seller Disclosure Schedule; provided, that theSeller may redact information not related to the Business from the Transferred Records prior to the delivery of theTransferred

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Records to the Purchaser and may retain a copy of any Transferred Records (which shall be held subject to Section 5.3) to theextent required by applicable Law.

Section 1.190 Transition Services Agreement.

“Transition Services Agreement” means the transition services agreement to be entered into by the Purchaserand the Seller as of Closing, substantially in the form attached hereto as Exhibit E.

Section 1.191 Treasury Regulations.

“Treasury Regulations” means the Treasury Regulations promulgated by the United States Department ofTreasury.

Section 1.192 Trigger Levels.

“Trigger Levels” means the following Environmental Laws in each case as in effect on the Closing Date: (a)for soil, those Environmental Laws known as (i) Table 3. Soil: Nonresidential Part 201 Generic Cleanup Criterial andScreening Levels, Mich. Admin. Code r. 299.48, under the Laws of the State of Michigan or (ii) 25 Pa. Code § 250,Appendix A, Tables 3a (Medium Specific Concentrations (MSCs) for Organic Regulated Substances in Soil: Direct ContactValues), 3b (MSCs for Organic Regulated Substances in Soil: Soil-to-Groundwater Values), 4a (MSCs for InorganicRegulated Substances in Soil: Direct Contact Values), and 4b (MSCs for Inorganic Regulated Substances in Soil: Soil-to-Groundwater Values) under the Laws of the Commonwealth of Pennsylvania; (b) for water, those Environmental Lawsknown as (i) Table 1. Groundwater: Residential and Nonresidential Part 201 Generic Cleanup Criteria and Screening Levels,Mich. Admin. Code r. 299.44, under the Laws of State of Michigan or (ii) 25 Pa. Code § 250, Appendix A, Tables 1 (MSCsfor Organic Regulated Substances in Groundwater) and 2 (MSCs for Inorganic Substances in Groundwater) under the Lawsof the Commonwealth of Pennsylvania; and (c) for gas, those Environmental Laws known as (i) Nonresidential GroundwaterVolatilization to Indoor Air Inhalation Criteria, Table 1. Groundwater: Residential and Nonresidential Part 201 GenericCleanup Criteria and Screening Levels, Mich. Admin. Code r. 299.44, and Soil Volatilization and Volatile Soil InhalationCriteria found in Table 3. Soil: Nonresidential Part 201 Generic Cleanup Criterial and Screening Levels, Mich. Admin. Coder. 299.48, under the Laws of State of Michigan or (ii) the Pennsylvania Department of Environmental Protection’s VaporIntrusion Screening Values Table, attached hereto as Schedule 1.192.

Section 1.193 WARN Act.

“WARN Act” means the Worker Adjustment Retraining and Notification Act of 1988, as amended.

Article II.

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SALE AND PURCHASEUpon the terms and subject to the conditions of this Agreement, at the Closing, the Seller shall (a) transfer to the SPV

52.6% of the Transferred Assets, free and clear of all Encumbrances, other than Permitted Encumbrances, in exchange for thepayment of the Purchase Price by the Purchaser and the assumption by the Purchaser and the SPV of 52.6% of the AssumedLiabilities, and (b) contribute to the SPV 47.4% of the Transferred Assets, free and clear of all Encumbrances, other than PermittedEncumbrances, in exchange for the Preferred Equity and the assumption by the SPV of 47.4% of the Assumed Liabilities (in eachcase, such percentages subject to adjustment to account for any adjustment to Purchase Price hereunder and to account for thePurchaser-Owned IP).

Section 2.1 Sale and Purchase of Assets.

(a) Upon the terms and subject to the conditions of this Agreement, in exchange for $300,000,000, subject toadjustment pursuant to Section 2.10 and Section 2.11, less (i) the amount of the Accrued 2021 Performance Bonuses, (ii) the amountof (A) the Accrued 2020 Performance Bonuses (to the extent unpaid as of the Closing Date), plus (B) to the extent the Accrued 2020Performance Bonuses are unpaid as of the Closing Date, the aggregate Purchaser DC Plan Contributions required to be made withrespect to such Accrued 2020 Performance Bonuses, and (iii) the amount payable to the Retention Agreement Recipients under theRetention Agreements (together with the employer portion of any payroll, social security, disability, workers compensation,unemployment or similar Taxes payable by the Purchaser related to such Accrued Performance Bonuses and amounts payable underthe Retention Agreements) (the “Purchase Price”), which shall be paid at the Closing by the Purchaser or the SPV to the Seller inimmediately available funds, at the Closing, the Seller shall, and shall cause its Subsidiaries to, sell, assign, transfer, convey anddeliver, to the SPV, the designee of the Purchaser (or, in the case of the Purchaser-Owned IP, the Purchaser), and the SPV, as thedesignee of the Purchaser (or, in the case of the Purchaser-Owned IP, the Purchaser), shall purchase from the Seller and itsSubsidiaries, subject to Section 2.1(b) and Section 2.5, 52.6% (such percentage subject to adjustment to account for any adjustmentto Purchase Price hereunder and to account for the Purchaser-Owned IP) of all right, title and interest in and to all of the assets,properties and rights of any kind of the Seller or any of its Subsidiaries that are primarily related to, or used or held for use in, theBusiness (the “Transferred Assets”), free and clear of all Encumbrances, other than Permitted Encumbrances, including thefollowing:

(i) the Owned Real Property, the Manufacturing Facilities and all Equipment;

(ii) the Transferred Intellectual Property and Transferred IT Assets;

(iii) the Transferred Inventory;

(iv) the Transferred Contracts, the Transferred IP Agreements and rights and benefits under SharedContracts to the extent primarily related to the Business;

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(v) (A) all prepaid expenses to the extent primarily related to the Business or any Transferred Asset and(B) the Transferred Accounts Receivable;

(vi) all claims against third parties, defenses and rights of offset or counterclaim (whether known orunknown) primarily related to the Business, any Transferred Asset or any Assumed Liability;

(vii) the proceeds from any insurance policies of the Seller or any of its Subsidiaries with respect to anyinsurance recoveries, in each case, solely to the extent arising out of or relating to any damage or destruction to, or loss of,any Transferred Assets to the extent any such damage or destruction remains unrepaired, in whole or in part, or any suchasset has not been replaced, as of the Closing Date (such rights, the “Post-Signing Insurance Proceeds”);

(viii) all of the Seller’s rights under warranties, indemnities, and all similar rights against third parties solelyto the extent related to any Transferred Assets;

(ix) the Transferred Permits;

(x) the Transferred Records;

(xi) the Transferred Information; and

(xii) the Goodwill.

(a) The Seller shall not sell, convey, assign, transfer, deliver or contribute, nor cause any of its Subsidiaries tosell, convey, assign, transfer, deliver or contribute, to the Purchaser or any of its Subsidiaries, and neither the Purchaser nor any of itsSubsidiaries shall purchase or receive, any of the following assets of the Seller or of any of its Subsidiaries (the “Excluded Assets”):

(i) all rights to refunds, credits or other benefits attributable to Excluded Taxes (other than any Tax assets,if any, included in the calculation of Net Working Capital);

(ii) all rights of the Seller or its Subsidiaries under any Contracts, except for the Seller’s or any of itsSubsidiaries’ (A) rights under the Transferred Contracts, (B) rights under the Transferred IP Agreements, (C) rights underShared Contracts to the extent primarily related to the Business and (D) rights under any other Contracts that constituteTransferred Assets;

(iii) the company seal, minute books, charter documents, stock or equity record books and such other booksand records pertaining to the organization, existence or capitalization of the Seller or its Subsidiaries, as well as any otherwritten records or materials, in each case, that do not constitute Transferred Records or Transferred Information;

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(iv) all real property of the Seller other than the Owned Real Property;

(v) all rights, title and interest of the Seller or its Subsidiaries under this Agreement and the otherTransaction Documents, any documents delivered or received in connection herewith or therewith and all other agreementsentered into by the Seller or any Subsidiary thereof in connection with the transactions contemplated by this Agreement(other than confidentiality or non-disclosure agreements);

(vi) all Excluded Claims;

(vii) all Tax Returns and other Tax records of the Seller or its Subsidiaries, other than those (A) relatingprimarily to the Transferred Assets or the Business which are reasonably necessary for the Purchaser to comply withapplicable Laws and (B) without duplication, relating exclusively to the Transferred Assets or the Business;

(viii) all current and prior insurance policies of the Seller or its Subsidiaries and all rights of any nature withrespect thereto, including all insurance recoveries thereunder and rights to assert claims with respect to any such insurancerecoveries, other than in respect of any Post-Signing Insurance Proceeds;

(ix) all rights, title and interest of the Seller or its Subsidiaries in and to the Retained Names and Marks,other than as expressly provided in Section 5.5;

(x) all accounts receivable of the Seller or its Subsidiaries that are not Transferred Accounts Receivable;

(xi) all Intellectual Property of the Seller or its Subsidiaries that is not Transferred Intellectual Property orIn-Licensed Intellectual Property;

(xii) all rights and interest of the Seller or its Subsidiaries under credit support instruments and any similarinstruments (including letters of credit, consignments, setoff rights, indemnities, guarantees, liens, security arrangements, anyother documents or rights intended to secure payment), in each case, that are not primarily related to the Business;

(xiii) all personnel, discipline, performance, employee compensation, medical and benefits and laborrelations records relating to the Business Employees, other than (A) Employee Records, (B) any such other records that arerequired to be provided to the Purchaser by Law or, (C) to the extent not prohibited by Law, as necessary to comply withSection 5.8;

(xiv) all customer credit files of the Seller or its Subsidiaries that are not primarily related to the Business;

(xv) all assets, insurance policies and other funding vehicles of the Seller Benefit Plans; and

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(xvi) the assets identified on Section 2.1(b)(xvi) of the Seller Disclosure Schedule.

Section 2.2 Assumption and Exclusion of Liabilities.

a. At the Closing, in connection with the Sale and Purchase and upon the terms and subject to the conditions setforth in this Agreement, the SPV, as designee of the Purchaser, shall assume, and agree to pay, perform and discharge when due,52.6% of the Liabilities of the Seller and its Subsidiaries in and to the following (and only the following) (the “AssumedLiabilities”):

i. except as otherwise set forth herein, all of the Liabilities of the Seller or any of its Subsidiaries to theextent arising out of, or relating to, the Transferred Assets (excluding the Transferred Contracts, the Transferred IPAgreements and the Shared Contracts which are addressed in Section 2.2(a)(ii) and Trade Accounts Payable), in each case,solely to the extent arising from and after the Closing Date, other than any Liabilities arising from, or relating to, an act oromission by the Seller or any of its Subsidiaries prior to the Closing Date;

ii. all Liabilities of the Seller or its Subsidiaries arising under, or relating to, the Transferred Contractsand the Transferred IP Agreements and that portion of the Shared Contracts that primarily relates to the Business inconnection with performance thereof, in each case arising on or after the Closing Date, other than any Liabilities arisingfrom, or relating to, an act or omission by the Seller or any of its Subsidiaries prior to the Closing Date;

iii. all Liabilities for Taxes, other than Excluded Taxes, that are imposed with respect to the Business orthe Transferred Assets for any Post-Closing Tax Period (excluding, for the avoidance of doubt, any income taxes of theSeller or any of its Subsidiaries);

iv. all of the Liabilities assumed by the Purchaser pursuant to Section 5.8;

v. all Purchaser Environmental Liabilities;

vi. all Liabilities included in the Final Net Working Capital, whenever arising; and

vii. all other Liabilities identified on Section 2.2(a)(vii) of the Seller Disclosure Schedule.

b. The Seller and its Subsidiaries shall retain, and shall be responsible for paying, performing and dischargingwhen due, and the Purchaser and its Subsidiaries shall not assume or have any responsibility for, any Liabilities of the Seller or anyof its Subsidiaries other than the Assumed Liabilities (all Liabilities not being assumed are collectively, the “Excluded

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Liabilities”). The Excluded Liabilities shall include the following Liabilities of the Seller or any of its Subsidiaries:

i. all Liabilities for Excluded Taxes;

ii. all Seller Environmental Liabilities;

iii. all Trade Accounts Payable;

iv. all Liabilities arising under, or relating to, the Seller Benefit Plans other than (A) the amount payableto the Retention Agreement Recipients under the Retention Agreements and (B) the Accrued Performance Bonuses;

v. all Liabilities arising under, or relating to, any product sold or delivered by Seller or any of itsAffiliates prior to the Closing Date;

vi. all Liabilities that relate to any employee, independent contractor, or other individual service providerof Seller or any of its Subsidiaries or Affiliates who does not become a Transferred Employee pursuant to Section 5.8 of thisAgreement, regardless of when they arise;

vii. all Liabilities with respect to Indebtedness of the Seller or any of its Subsidiaries;

viii. all Liabilities arising under, or relating to, any Excluded Assets;

ix. all Liabilities of the Seller or any of its Subsidiaries that are not Assumed Liabilities; and

x. all other Liabilities identified on Section 2.2(b)(x) of the Seller Disclosure Schedule.

Section 2.3 Contribution of Transferred Assets and Assumed Liabilities.

At the Closing, upon the terms and subject to the conditions set forth in this Agreement and the SPV OperatingAgreement, the Seller shall effect the Contribution by means of contributing to the SPV, 47.4% of all right, title and interest in andto the Transferred Assets free and clear of all Encumbrances, other than Permitted Encumbrances, and assigning to the SPV, and theSPV shall assume, and agree to pay, perform and discharge when due, 47.4% of the Assumed Liabilities, and in exchange therefore,the SPV shall effect the Preferred Issuance by means of issuing to the Seller the Preferred Equity (in each case, such percentagesubject to adjustment to account for any adjustment to Purchase Price hereunder and to account for the Purchaser-Owned IP).

Section 2.4 Procedures for the Transfer of Transferred Assets

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. The Seller and the Purchaser shall effect on the Closing Date the transfer, assignment or contribution of the Transferred Assets andthe assumption and assignment or contribution of the Assumed Liabilities from the Seller or any of its Subsidiaries, as applicable, tothe SPV (or, in the case of the Purchaser-Owned IP, the Purchaser) pursuant to the Local Conveyance Documents and theIntellectual Property Assignment Agreement.

Section 2.5 Shared Contracts; Assignment of Contracts and Rights; Post-Signing Insurance Proceeds.

a. Each Shared Contract shall be assigned, transferred, and conveyed or contributed only with respect to (andpreserving the meaning of) those parts that primarily relate to the Business or appropriately amended prior to, on or after theClosing, so that the Purchaser shall be entitled to all of the rights and benefits of those parts of the Shared Contract that primarilyrelate to the Business and shall assume only the portion of any Liabilities thereunder that constitute Assumed Liabilities.

b. Anything in this Agreement to the contrary notwithstanding, this Agreement shall not constitute an agreementto assign any Contract at the Closing that otherwise would be a Transferred Contract or a Transferred IP Agreement or any rightthereunder if an attempted assignment, without the consent of a third party, would constitute a breach of such Contract or adverselyaffect the rights of the Purchaser or its Subsidiaries thereunder or be ineffective with respect to any party thereto. The Seller will useits commercially reasonable efforts to obtain the consent of the other parties to any such Contract in connection with the transfer ofsuch Contract or any claim or right or any benefit arising thereunder for the assignment thereof to the Purchaser. If, on the ClosingDate, any such consent is not obtained, or if an attempted transfer or assignment thereof would be ineffective or a violation ofapplicable Law so that the Purchaser would not in fact receive all such rights (or, in the case of a Shared Contract, all of the rightsthereunder primarily related to the Business), the Seller will cooperate in an arrangement reasonably agreed upon by the partiesunder which the Purchaser or its designated Subsidiary would, in compliance with applicable Law, obtain all of the benefits (or, inthe case of a Shared Contract, all of the rights thereunder primarily related to the Business) and assume the obligations and bear theeconomic burdens associated with such Contract, claim, right or benefit that constitute Assumed Liabilities, including by the Sellersubcontracting, sublicensing or subleasing to the Purchaser, or under which the Seller would enforce, for the benefit of thePurchaser, and at the expense of the Purchaser, any and all of its and its Subsidiaries’ rights against a third party thereto (includingany Governmental Authority) associated with such Contract, claim, right or benefit (collectively, “Third-Party Rights”), and theSeller would promptly pay to the Purchaser when received all monies received by it or its Subsidiaries under any such Contract orany claim or right or any benefit arising thereunder. Promptly upon obtaining the requisite third-party consent thereto, such Contractor right, if otherwise includable in the Transferred Assets, shall promptly be transferred and assigned to the Purchaser or its designeehereunder for no additional consideration. The provisions of this Section 2.5 shall in no way impose upon the Seller any obligationto incur out-of-pocket expenses in connection with obtaining consents unless the Purchaser agrees to reimburse the Seller for suchexpenses to the Seller. Following the Closing Date and prior to the date that a

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Contract is assigned to the Purchaser in accordance with this Section 2.5(b), the Purchaser shall not have any Liability under suchContract (including due to the breach thereof by the Seller).

c. From and after the Closing, the Seller shall use commercially reasonable efforts to exercise all rights underany insurance policies of the Seller or any of its Subsidiaries (including all rights to assert claims) arising out of or relating to anydamage or destruction to, or loss of, any Transferred Asset, to the extent such damage or destruction remained unrepaired, in wholeor in part, or any such asset had not been replaced, as of the Closing Date.

Section 2.6 Allocation of Purchase Price.

a. At or prior to the Closing Date, the Purchaser shall determine the amount of, and deliver a written schedule toSeller which allocates the amount of, the Purchase Price attributable to the Purchaser-Owned IP. Within 120 days after the Closing,the Seller shall determine and deliver to the Purchaser a written schedule (including as amended pursuant to this Section 2.6(a) orSection 2.6(b), the “Allocation Schedule”) that allocates the Purchase Price (together with any other amounts treated for U.S. federalincome Tax purposes as paid for the Transferred Assets other than the Purchaser-Owned IP) among the Transferred Assets otherthan the Purchaser-Owned IP in accordance with Section 1060 of the Code and the Treasury Regulations promulgated thereunder(and any similar provision of state, local or foreign Law, as appropriate). The Purchaser may dispute any amounts reflected on theAllocation Schedule by providing written notice to the Seller of the disputed items, and setting forth in reasonable detail the basis ofsuch dispute, within 30 days following receipt of the Allocation Schedule. If the Purchaser disputes any portion of the AllocationSchedule, the Seller and the Purchaser shall attempt to resolve any such dispute through good faith negotiations within 30 daysfollowing the Seller’s receipt of the Purchaser’s dispute notice, and shall amend the Allocation Schedule to reflect the resolution (ifany) of such dispute. The Seller and the Purchaser shall prepare and file all Tax Returns (including IRS Form 8594) in a mannerconsistent with the Allocation Schedule, except to the extent a dispute was unable to be resolved with respect thereto, and shall nottake any position inconsistent therewith in any Tax Return, audit, examination, claim, adjustment, litigation or other proceeding withrespect to Taxes, unless required to do so by applicable Law. Nothing contained herein shall prevent the Seller, the Seller’sAffiliates, the Purchaser or the Purchaser’s Affiliates from settling any proposed deficiency or adjustment by any GovernmentalAuthority based upon or arising out of the Allocation Schedule or the allocation of the Purchase Price among the Transferred Assets.The parties hereto will promptly inform one another of any challenge by any Governmental Authority to any allocation made inaccordance with the Allocation Schedule, and the parties agree to consult and keep one another informed with respect to the statusof, and any discussion, proposal or submission with respect to, such challenge.

b. To the extent that there is an adjustment to the Purchase Price (or any other amount treated for U.S. federalincome tax purposes as paid for the Transferred Assets) subsequent to the Closing Date, the parties shall negotiate in good faith toallocate such adjustment to the Transferred Assets to which it relates and shall amend the Allocation Schedule accordingly.

Section 2.7 Closing

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. Subject to the terms and conditions of this Agreement, the Sale and Purchase and the Contribution and the assumption of theAssumed Liabilities in connection with the Sale and Purchase and the Contribution shall take place at a closing (the “Closing”) to beheld at the offices of Troutman Pepper Hamilton Sanders LLP, 875 Third Avenue, New York, New York 10022 at 10:00 a.m. NewYork time (a) on the later of (i) May 31, 2021, subject to the satisfaction or waiver of all of the conditions set forth in Article VII onor before the fifth Business Day prior to such date (other than those conditions that by their nature can only be satisfied or waived atthe Closing, but subject to the satisfaction or waiver of those conditions at that time) or (ii) the fifth Business Day following the dayon which all of the conditions set forth in Article VII (other than those conditions that by their nature can only be satisfied or waivedat the Closing, but subject to the satisfaction or waiver of those conditions at that time) are satisfied or waived; or (b) at such otherplace or at such other time or on such other date as the Seller and the Purchaser may mutually agree upon in writing (the day onwhich the Closing takes place, the “Closing Date”).

Section 2.8 Closing Deliveries by the Seller

. At the Closing, the Seller shall deliver or cause to be delivered to the Purchaser or the Title Insurer, as the case may be:

a. duly executed counterparts of (i) each Local Conveyance Document, (ii) the SPV Operating Agreement, and(iii) each other Transaction Document that is to be executed at the Closing and, in each case, to which the Seller or any of itsSubsidiaries is a party;

b. a receipt for the Closing Date Cash Payment;

c. the certificate referenced in Section 7.2(a)(iii);

d. a duly completed IRS Form W-9 executed by the Seller or a certificate, dated as of the Closing Date, as to thenon-foreign status of the Seller pursuant to Treasury Regulations Section 1.1445-2(b)(2), in a form reasonably acceptable to thePurchaser;

e. with respect to the Owned Real Property, affidavits and such other customary documentation delivered by theSeller as shall be reasonably required by a title company selected by the Purchaser (provided such title company is not an Affiliate ofPurchaser) (the “Title Insurer”) in form and substance acceptable to the Seller reasonably required for similar transactions in thestate where each Owned Real Property is located, to be committed to issue title insurance policies (each, a “Title Policy”, andcollectively, the “Title Insurance”) with respect to the Owned Real Property insuring the Purchaser or its designee as the fee simpleowner of the Owned Real Property, subject only to Permitted Encumbrances, and the Title Insurer shall be ready, willing and able toissue such Title Policy to Purchaser with customary endorsements; provided, however, that Purchaser’s actual payment of thepremium for the Title Policy shall not be a condition to Closing; and

f. evidence that all monetary liens and encumbrances have been released or discharged in connection with theOwned Real Property.

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Section 2.9 Closing Deliveries by the Purchaser

. At the Closing, the Purchaser and the SPV shall deliver to the Seller:

a. the Closing Date Cash Payment by wire transfer in immediately available funds to the bank account specifiedby the Seller in writing at least two Business Days prior to the Closing;

b. the Preferred Equity (which shall be evidenced by the execution and delivery of the SPV OperatingAgreement);

c. executed counterparts of (i) each Local Conveyance Document, (ii) the SPV Operating Agreement, and (iii)each other Transaction Document that is to be executed at the Closing and, in each case, to which the Purchaser or any of itsSubsidiaries (including the SPV) is a party; and

d. the certificate referenced in Section 7.1(a)(iii).

Section 2.10 Preliminary Adjustment of Purchase Price

. The Seller shall provide to the Purchaser at least three Business Days prior to the Closing Date a written statement (the “EstimatedPurchase Price Statement”) setting forth in reasonable detail the Seller’s good faith calculation of the estimated Net Working Capital(the “Preliminary Net Working Capital”) prepared in accordance with the policies and procedures used in the preparation of theBaseline Net Working Capital as set forth on Section 1.100 of the Seller Disclosure Schedule, together with reasonable supportingcalculations. The Estimated Purchase Price Statement shall also set forth the Seller’s good faith calculation of the Purchase Pricepayable as of the Closing Date, determined in accordance with this Section 2.10. The Purchase Price shall be increased by theamount, if any, that the Preliminary Net Working Capital exceeds the Baseline Net Working Capital or decreased by the amount, ifany, that the Baseline Net Working Capital exceeds the Preliminary Net Working Capital. The Estimated Purchase Price Statementshall be accompanied by a certificate executed by a senior financial officer of the Seller to the effect that the Preliminary NetWorking Capital has been calculated in good faith in accordance with this Section 2.10. To the extent that any foreign currencyconversions are necessary in connection with the preparation of Preliminary Net Working Capital, such conversions shall beconsistent with the method for conversion of foreign currency as used by the Seller in preparation of its audited financial statementsusing the applicable exchange rate as of the date immediately prior to the date of the Estimated Purchase Price Statement.

Section 2.11 Final Net Working Capital; Adjustment of Purchase Price.

a. Within 60 days after the Closing Date, the Purchaser shall prepare and deliver to the Seller a statement (the“Post-Closing Adjustment”) setting forth in reasonable detail its calculation of Net Working Capital (the “Final Net WorkingCapital”) prepared in accordance with the policies and procedures used in the preparation of the Baseline Net Working Capital as setforth on Section 2.10 of the Seller Disclosure Schedule. The Post-Closing

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Adjustment shall also set forth the Purchaser’s calculation of the Purchase Price, determined in accordance with this Section 2.11.The Post-Closing Adjustment shall be accompanied by a certificate executed by a senior financial officer of the Purchaser to theeffect that the Post-Closing Adjustment has been prepared in good faith in accordance with this Section 2.11(a). To the extent thatany foreign currency conversions are necessary in connection with the preparation of the Final Net Working Capital, suchconversions shall be consistent with the method for conversion of foreign currency as used by the Seller in the preparation of itsaudited financial statements using the applicable exchange rate as of the Closing Date.

b. During the 45-day period following delivery of the Post-Closing Adjustment, during normal business hoursand upon reasonable advance notice, the Purchaser shall provide reasonable access to the Seller to all workpapers and other booksand records utilized by the Purchaser or its Representatives in the preparation of the Post-Closing Adjustment (in the case ofaccountant work papers of the outside independent accountant of the Purchaser, subject to the Seller entering into a customaryconfidentiality agreement with respect thereto), in each case, as reasonably requested by the Seller solely for the purpose of theSeller’s review of the Post-Closing Adjustment.

c. If the Seller disagrees with the Purchaser’s calculation of Final Net Working Capital, the Seller shall, within45 days after the Seller’s receipt of the Post-Closing Adjustment, deliver a written notice (the “Dispute Notice”) to the Purchaserdisagreeing with such calculation. The Dispute Notice will set forth the Seller’s objections, if any, to the Post-Closing Adjustment inreasonable detail, the Seller’s grounds for such disagreement and the Seller’s calculation of Final Net Working Capital. The DisputeNotice shall specify those items deemed to be in dispute (the “Disputed Items”), and all other matters included in the Post-ClosingAdjustment delivered by the Purchaser shall be deemed to be final and binding on the parties hereto. The failure by the Seller todeliver to the Purchaser the Dispute Notice within such period shall be deemed to constitute the Seller’s acceptance of the Post-Closing Adjustment. After timely delivery of the Dispute Notice by the Seller, the parties will use commercially reasonable efforts toresolve any Disputed Items, and any resolution by the Seller and the Purchaser of such Disputed Items in writing shall be final andbinding on the parties hereto.

d. If any Disputed Items cannot be resolved by the parties within 30 days after the Seller delivers the DisputeNotice to the Purchaser, such Disputed Items shall be referred to the Independent Accountant. Unless otherwise agreed, not laterthan 30 days after the referral of any Disputed Items to the Independent Accountant, the Seller and the Purchaser shall concurrentlysubmit written statements to the Independent Accountant (with a copy to the other party) setting forth their respective positionsregarding the Disputed Items which remain in dispute. The Seller and the Purchaser shall instruct the Independent Accountant torender its decision resolving the dispute within 30 days after submission of the written statements, and during such period, the partiesshall use commercially reasonable efforts to make available to the Independent Accountant during normal business hours suchemployees, information, books and records as may be reasonably requested by the Independent Accountant to make its finaldetermination (in the case of accountant work papers of the outside independent accountant of

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the Purchaser, subject to the Independent Accountant entering into a customary confidentiality agreement with respect thereto). Inresolving any Disputed Item, the Independent Accountant (i) shall be bound by the provisions of this Section 2.11 and the definitionsset forth in this Agreement; (ii) shall limit its review to the Disputed Items submitted to the Independent Accountant for resolutionand not otherwise investigate matters independently; and (iii) shall further limit its review of the Disputed Items solely to whetherthe Disputed Items have been prepared in accordance with this Section 2.11 and the definitions set forth in this Agreement or containany mathematical or clerical error. The determination of any Disputed Items cannot, however, be in excess of, or less than, thegreatest or lowest value, respectively, claimed for any such item in the Post-Closing Adjustment or the Dispute Notice. The Sellerand the Purchaser agree that the resolution by the Independent Accountant of any Disputed Items shall be final and binding on theparties hereto. All fees and expenses of the Independent Accountant relating to the work, if any, to be performed by the IndependentAccountant hereunder shall be borne by the Seller and the Purchaser in inverse proportion as they may prevail on the mattersresolved by the Independent Accountant, which proportionate allocation shall be calculated on an aggregate basis based on therelative dollar values of the amounts in dispute and shall be determined by the Independent Accountant. The Seller and the Purchaseragree that the procedure set forth in this Section 2.11 for resolving disputes with respect to Final Net Working Capital and the Post-Closing Adjustment shall be the sole and exclusive method for resolving such disputes; provided, however, that the parties heretoagree that judgment may be entered upon the determination of the Independent Accountant in any court having jurisdiction over theparty against which such determination is to be enforced.

e. If the Final Net Working Capital as finally determined pursuant to this Section 2.11 is less than thePreliminary Net Working Capital, then the Purchase Price shall be decreased by the amount of such shortfall, and the Seller shall paysuch amount to the Purchaser, as an adjustment to the Purchase Price; or is more than the Preliminary Net Working Capital, then thePurchase Price shall be increased by the amount of such excess, and the Purchaser shall pay such amount to the Seller, as anadjustment to the Purchase Price. Any such payment pursuant to the preceding sentence will be made by wire transfer ofimmediately available funds, to an account (or accounts) designated by the Purchaser or the Seller, as the case may be, on the later of(A) the third Business Day after acceptance or deemed acceptance by the Seller of the Post-Closing Adjustment (as contemplated bySection 2.11(c) above) or (B) the third Business Day following resolution of all Disputed Items (as contemplated by Section 2.11(c)or (d) above). Any payment required pursuant to this Section 2.11(e) shall constitute a payment in respect of the Purchase Price.

f. If the delivery deadline date for the Post-Closing Adjustment or the Dispute Notice is a day that is not aBusiness Day, the applicable delivery deadline date shall be the immediately following Business Day.

g. Notwithstanding any provision set forth in this Section 2.11 or elsewhere in this Agreement to the contrary,there is no general agreement among the parties to submit disputes under this Agreement to arbitration (other than disputes withrespect to the Post-Closing Adjustment, which shall be resolved solely in accordance with this Section 2.11).

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Section 2.12 Withholding

. The Purchaser shall be entitled to deduct and withhold such amounts as the Purchaser is required to deduct and withhold under theCode, or any provision of state, local or non-U.S. Tax law, with respect to the making of any payment under this Agreement;provided, however, that if the Seller delivers valid documentation which both the Seller and the Purchaser reasonably agreecompletely obviates the need for such withholding (including, but not limited to, a duly executed IRS Form W-9 or certificate ofnonforeign status pursuant to Section 2.8(d) with respect to withholding pursuant to Section 1445 of the Code, absent a change inLaw), then the Purchaser shall not be entitled to deduct and withhold any corresponding amounts otherwise payable to the Sellerhereunder. The Purchaser shall use commercially reasonable efforts to provide the Seller with written notice as soon as reasonablypracticable upon becoming aware that any such deduction or withholding is required, and the parties shall use commerciallyreasonable efforts, to mitigate any such deduction or withholding. To the extent that amounts are so deducted and withheld by thePurchaser and remitted to the proper Governmental Authority, such amounts shall be treated for all purposes of this Agreement ashaving been paid to the Person otherwise entitled to such payment hereunder.

Article III.

REPRESENTATIONS AND WARRANTIES OF THE SELLERThe Seller hereby represents and warrants to the Purchaser and the SPV, subject to such exceptions as are disclosed in the

applicable section of the Seller Disclosure Schedule, as follows:

Section 3.1 Organization, Authority and Qualification of the Seller.

a. The Seller is a corporation duly organized, validly existing and in good standing under the laws of theCommonwealth of Virginia and has all necessary corporate power and authority to enter into this Agreement and the otherTransaction Documents to which it is a party, to carry out its obligations hereunder and thereunder and to consummate thetransactions contemplated hereby and thereby. The execution and delivery by the Seller of this Agreement and the other TransactionDocuments to which it is a party, the performance by the Seller of its obligations hereunder and thereunder and the consummation bythe Seller of the transactions contemplated hereby and thereby have been duly authorized by all requisite corporate action on the partof the Seller. This Agreement has been, and upon their execution, the other Transaction Documents to which the Seller is a party,will be, duly executed and delivered by the Seller, and (assuming due authorization, execution and delivery by the Purchaser) thisAgreement constitutes, and upon their execution, each of the other Transaction Documents to which the Seller is a party, willconstitute, a legal, valid and binding obligation of the Seller, enforceable against the Seller in accordance with their respective terms,subject to the effect of any applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similarLaws relating to or affecting creditors’ rights generally and subject to the effect of general principles of equity (regardless of whetherconsidered in a proceeding at law or in equity).

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b. The Seller has the corporate power and authority to operate the Business as now operated and is duly qualifiedto do business, and, to the extent legally applicable, is in good standing, in each jurisdiction where the character of its owned,operated or leased properties or the nature of its activities makes such qualification necessary, except for jurisdictions where thefailure to be so qualified or in good standing has not had, and would not reasonably be expected to have, individually or in theaggregate, a Material Adverse Effect.


. Assuming that all consents, approvals, authorizations and other actions described in Section 3.3 or set forth in Section 3.2 orSection 7.1(b) of the Seller Disclosure Schedule have been obtained, all filings and notifications described in Section 3.3 or set forthin Section 3.2 or Section 7.1(b) of the Seller Disclosure Schedule have been made, any applicable waiting period has expired or beenterminated, the execution, delivery and performance by the Seller of this Agreement and each of the other Transaction Documents towhich it is a party and the consummation by the Seller of the transactions contemplated hereby and thereby, do not and will not violate, conflict with, or result in the breach of any provision of the articles of incorporation or bylaws of the Seller; conflict with orviolate any Law or Governmental Order applicable to the Seller or the Business; conflict with, result in any breach of, constitute adefault (or an event which, with or without the giving of notice or lapse of time, or both, would become such a default) under,require any consent under, or give to others any rights of termination, amendment, acceleration or cancellation of, any materialContract to which the Seller or any of its Subsidiaries is a party or result in the creation of any Encumbrance upon any of theTransferred Assets, except, in the case of clauses (b), (c) and (d), as would not have, or reasonably be expected to have, individuallyor in the aggregate, a Material Adverse Effect.

Section 3.3 Governmental Consents and Approvals

. Except as set forth in Items 2-6 of Section 7.2(g) of the Seller Disclosure Schedule, the execution, delivery and performance by theSeller of this Agreement and each Transaction Document to which it is a party does not require any consent, approval, authorizationor other order or declaration of, action by, filing with or notification to, any Governmental Authority, other than compliance with,and filings under, the HSR Act and any other applicable filings and approvals in the jurisdictions set forth on Section 7.1(b) of theSeller Disclosure Schedule and any other applicable Antitrust Laws; or where the failure to obtain such consent, approval,authorization or action, or to make such filing or notification, would not, and would not reasonably be expected to, individually or inthe aggregate, have a Material Adverse Effect.

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Section 3.4 Financial Information.

a. The Financial Statements, subject to the notes thereto, were derived from the audited consolidated financialstatements of the Seller and represent, in all material respects, the combined income of the Business as of the dates thereof for theperiods covered thereby. The Financial Statements were prepared from the books and records of the Business in accordance with theaccounting procedures and methodologies set forth on Section 3.4 of the Seller Disclosure Schedule. The Seller makes norepresentation that the Financial Statements were prepared in accordance with, or comply with, GAAP.

b. The Financial Statements represent in all material respects the financial position of the Business as of therespective dates thereof and the results of operations of the Business for the periods covered thereby.

c. The Business has not incurred since December 31, 2019, any material Liabilities, other than as specificallyreflected in the Financial Statements, Liabilities incurred in the ordinary course of business consistent with past practice sinceDecember 31, 2019, Excluded Liabilities or Liabilities that would not have, and would not reasonably be expected to have,individually or in the aggregate, a Material Adverse Effect. Neither the Seller nor any of its Subsidiaries has taken out any loan,received any loan assistance, received any other financial assistance, or requested any of the foregoing, in each case under theCARES Act.

Section 3.5 Absence of Changes; No Material Adverse Effect

. Since December 31, 2019, the Business has been conducted in the ordinary course of business consistent with past practice, without limiting the generality of the foregoing, neither the Seller nor any of its Subsidiaries has taken any action or omitted to takeany action which, if taken or omitted to be taken after the date hereof and prior to the Closing Date, would require the consent of thePurchaser pursuant to Section 5.1(c)(i), (ii), (iii), (iv), (v), (vi), (vii), (ix), (xi), (xii), (xiv) or (xv) and there has not occurred any fact,circumstance, effect, change, event, condition, state of facts or development that has had, or would reasonably be expected to have,individually or in the aggregate, a Material Adverse Effect.

Section 3.6 Litigation

. There is no Action by or against the Seller and specifically or primarily relating to or in connection with the Business pending or, tothe Seller’s Knowledge, threatened before any Governmental Authority pursuant to which money damages in excess of $100,000are sought, involving any non-monetary relief (including any criminal proceeding, investigation or indictment), that would, orwould reasonably be expected to materially and adversely affect the legality, validity or enforceability of this Agreement or anyother Transaction Document or that would, or would reasonably be expected to, prevent or materially delay the consummation bythe Seller of the transactions contemplated by this Agreement or any other Transaction Documents. The Seller is not, in connectionwith the Business or the Transferred Assets, subject to any order, judgment, preliminary or permanent injunction, temporaryrestraining order, award, citation, decree, consent decree or writ of any Governmental Authority.

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Section 3.7 Compliance with Laws.

a. The Seller conducts, and during the last three years has conducted, the Business, in all material respects, inaccordance with all Laws and Governmental Orders applicable to the Business. To the Knowledge of the Seller, no event hasoccurred or circumstance exists that (with or without notice or lapse of time or both) would reasonably be expected to constitute orresult in a material violation by the Seller of, or a material failure on the part of the Seller to comply with, any Law, Permit orGovernmental Order in connection with the operation of Business.

b. Each of the Seller and its Subsidiaries and, to the Knowledge of the Seller, their respective officers, directors,employees and Representatives acting on their behalf, are, and in the past three years have been, in connection with the Business, incompliance, in all material respects, with all applicable Anti-Corruption Laws and U.S. and any applicable foreign economicsanction Laws, including economic sanctions administered by the U.S. Department of the Treasury’s Office of Foreign AssetsControl (collectively, “Sanctions”) and U.S. and applicable foreign Laws pertaining to export and import controls, including thoseadministered by the U.S. Departments of Commerce and State, and applicable anti-money laundering Laws (collectively, “TradeControls”).

c. None of the Seller or its Subsidiaries, or their directors, officers, or employees, nor to the Knowledge of theSeller, any agents acting on their behalf, is or has been in connection with the Business identified on any Sanctions-related list ofrestricted or blocked persons; organized, resident, or located in any country or territory that is itself the subject of Sanctions; orowned or controlled by any Person or Persons described in clause (i) or (ii).

d. There have been no claims, complaints, charges, investigations, voluntary disclosures, or proceedings underTrade Controls involving the Seller or its Subsidiaries in connection with the Business, and to the Knowledge of the Seller, there areno pending or threatened claims or investigations involving suspect or confirmed violations thereof in connection with the Business.

Section 3.8 Intellectual Property.

a. Section 3.8(a) of the Seller Disclosure Schedule contains a true and correct list of all of the TransferredIntellectual Property consisting of Registered Intellectual Property, including for each such item the record owner, and, if, to theKnowledge of the Seller, different, the legal owner and beneficial owner of such item, the jurisdiction in which such item is issued,registered or pending and the issuance, registration or application date and number of such item. As of the date hereof, each suchitem of Registered Intellectual Property is in effect, subsisting and not abandoned, all maintenance and prosecution fees relatingthereto that are due on or before the date hereof have been paid and, to the Knowledge of the Seller, is valid and enforceable.

b. Except as set forth on Section 3.8(b) of the Seller Disclosure Schedule, the Seller is the sole and exclusiveowner of all right, title and interest, free and clear of all

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Encumbrances (other than Permitted Encumbrances) in and to the Transferred Intellectual Property and, to the Knowledge of theSeller, otherwise has all necessary licenses, rights, permissions and authorizations to use all other Intellectual Property used in theBusiness, including all computer software licenses. The Transferred Intellectual Property, the In-Licensed Intellectual Property andthe Intellectual Property licensed to the Purchaser under Section 5.5 constitute all of the Intellectual Property used or held for use inconnection with the operation of the Business, and there is no other Intellectual Property that is used by, material to, or necessary for,the operation of the Business or for the continued operation of the Business after the Closing in substantially the same manner asoperated prior to the Closing. After the Closing, there will be no Intellectual Property owned or used by the Seller or its Subsidiariesthat is necessary for the Business as of the Closing as to which no provision is made in the Transaction Documents for continued usethereof after the Closing by the Purchaser.

c. Neither the Transferred Intellectual Property nor the Business as conducted by the Seller interferes with,dilutes, infringes, misappropriates or otherwise violates any Intellectual Property rights of any third party, and has not done so in thelast six years (except that the foregoing representation is given to the Knowledge of the Seller with respect to patents). The Sellerhas, with respect to the operation of the Business, undertaken patent clearance searches and reviews consistent with the Seller’sreasonable business judgment, and such patent clearance searches and reviews have not identified any products or services that, inthe Seller’s reasonable judgment, infringe, or are reasonably likely to infringe, a valid third party patent. To the Knowledge of theSeller, no third party currently interferes with, dilutes, infringes upon, misappropriates, or violates and nor during the last three yearshas any third party interfered with, diluted, infringed upon, misappropriated, or otherwise violated any Transferred IntellectualProperty. There is no claim against the Seller or any of its Subsidiaries pending or, to the Knowledge of the Seller, threatened which alleges any infringement, misappropriation, misuse or violation of any Intellectual Property of a third party, invites the Seller orsuch Subsidiary to take a license under any Intellectual Property of a third party or consider the applicability of any IntellectualProperty of a third party to the conduct of the Business or challenges the ownership, use, validity or enforceability of anyTransferred Intellectual Property. Neither the Seller nor any of its Subsidiaries has made any written claim against any third partyalleging any infringement, misappropriation or other violation of any Transferred Intellectual Property. Other than rejections inroutine patent and trademark prosecution in pending patent or trademark applications, none of the Transferred Intellectual Propertyis subject to any outstanding order, judgment, injunction, decree, ruling or agreement adversely affecting the Seller’s or itsSubsidiaries’ use thereof or rights thereto, or that would impair the validity or enforceability thereof.

d. Each current and former employee, consultant and contractor of the Seller and its Subsidiaries that is or wasinvolved in the conception, development or reduction to practice of any Transferred Intellectual Property for the Business hasentered into a valid, written non-disclosure and invention assignment agreement whereby such employees, consultants or contractorshave assigned to the Seller all of their right, title and interest in and to the Transferred Intellectual Property that are conceived of ordeveloped by such employees, consultants and contractors. To the Knowledge of the Seller, no current or former employee,consultant or

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contractor of the Seller or any of its Subsidiaries is in default or breach of any term of any employment agreement, non-disclosureagreement, assignment of invention agreement or similar agreement relating to the protection, ownership, development, use ortransfer of Transferred Intellectual Property or, to the Seller’s Knowledge, any other Intellectual Property.

e. The Seller and its Subsidiaries have taken reasonable measures to maintain the confidentiality and value of allconfidential information and trade secrets used or held for use in the operation of the Business. To the Knowledge of the Seller, otherthan disclosures made in the Seller’s reasonable business judgment, no material confidential information or trade secrets used or heldfor use in the Business have been disclosed by the Seller or any of its Subsidiaries to any Person except pursuant to non-disclosureand/or license agreements that obligate such Person to keep such confidential information or trade secrets confidential both duringand, for a reasonable period, after the term of such agreement.

f. Except as set forth on Section 3.8(f) of the Seller Disclosure Schedule, there are no royalties, honoraria, feesor other payments payable by the Seller or any of its Subsidiaries to any Person under any Transferred IP Agreement, including forthe acquisition, licensing, sublicensing or use of any Transferred Intellectual Property. The consummation of the transactionscontemplated by the Transaction Documents will not result in any of the following pursuant to the terms of any Contract to whichthe Seller or any of its Subsidiaries is a party: the grant, license or assignment to any Person of any interest in or to, the modificationor loss of any rights with respect to, or the creation of any Encumbrance on, any Transferred Intellectual Property, or any IntellectualProperty owned by or licensed to the Purchaser or its Affiliates prior to Closing; or the Purchaser or its Affiliates being (A) boundby or subject to any non-compete or licensing obligation, covenant not to sue, or other restriction on or modification of the current orcontemplated operation or scope of its business, which that Person was not bound by or subject to prior to the Closing, or (B)obligated to (1) pay any royalties, honoraria, fees or other payments to any Person in excess of those payable prior to the Closing or(2) provide or offer any discounts or other reduced payment obligations, in each case, to any Person in excess of those provided tothat Person prior to Closing.

g. To the Knowledge of the Seller, the Transferred IT Assets are free from material bugs and other defects, havenot materially malfunctioned or failed within the past three years, and to the Knowledge of the Seller, do not contain any viruses,Trojan horses, malware or similar devices. The Seller and its Subsidiaries have implemented reasonable backup, security anddisaster recovery measures, and to the Knowledge of the Seller, no Person has gained unauthorized access to any IT Assets used inthe Business.

Section 3.9 Real Property.

a. Section 1.102 of the Seller Disclosure Schedule sets forth a true and complete list of each parcel of OwnedReal Property and the identity of the owner of each such parcel of Owned Real Property. The Seller has a good, valid and marketablefee simple ownership interest in each parcel of Owned Real Property, free and clear of all Encumbrances other than PermittedEncumbrances, and has the full right, power and authority to convey the Owned Real Property to the Purchaser. Copies of theSeller’s title insurance policies, opinions,

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abstracts, surveys and vesting deeds in the Seller’s control and possession relating to the Owned Real Property have been previouslydelivered to the Purchaser.

b. Except as set forth on Section 5.1(c)(iv)(B) of the Seller Disclosure Schedule, there are no material repairs orcapital repairs (other than capital repairs in the ordinary course of business) required or contemplated with respect to theManufacturing Facilities, building systems and other improvements on the Owned Real Property.

c. Each Owned Real Property has physical and, to the Knowledge of the Seller, vehicular and pedestrian accessto and from public roadways as may be necessary to the operation of the business. To the Knowledge of the Seller, no fact orcondition exists which would result in the termination of (i) the current access from each parcel of the Owned Real Property, and (ii)continued use, operation, maintenance, repair and replacement of all existing and currently committed utility lines used by the Sellerin connection with the Business, except where such termination would not have a Material Adverse Effect.

d. The Owned Real Property constitutes all real estate and rights in real property that are used or necessary inconnection with the operation of the Business in the manner currently conducted.

e. There are no pending or, to the Knowledge of the Seller, threatened condemnation or expropriationproceedings, lawsuits or proceedings relating to the Owned Real Property or any part thereof or other legal matters affectingadversely the current use or occupancy thereof.

f. The Seller, in respect of each Manufacturing Facility, holds all approvals of Governmental Authorities(including licenses and Permits) required in connection with the ownership, occupation or operation thereof, and each ManufacturingFacility is, and has been during the past three years, operated and maintained in all material respects in accordance with applicableLaw, including any fire, health, building, use, occupancy or zoning Law.

g. Except for Permitted Encumbrances, there are no oral or written leases, subleases, licenses, concessions orother agreements, written or oral, granting to any party or parties (other than the Seller) the right of use or occupancy of any portionof the Owned Real Property, or options granting any right to purchase or lease, any portion of the Manufacturing Facilities or OwnedReal Property, and, other than the Seller, there is no Person in possession of any portion of the Owned Real Property.

h. The Seller has not received any notice of any violation of any applicable zoning ordinance or other Lawrelating to, or any notice that any work is required pursuant to applicable Law to be done upon or in connection with, the operationof the Manufacturing Facilities or the operation of the Owned Real Property.

i. There is no Action before any Governmental Authority pending or, to the Seller’s Knowledge, threatened, tochange the zoning or building ordinances or any other Laws affecting the Owned Real Property.

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Section 3.10 Employees; Employee Benefit Matters.

a. Section 3.10(a) of the Seller Disclosure Schedule contains a complete, true and correct list of all the BusinessEmployees and indicates for each such Business Employee, to the extent applicable and to the extent permissible under applicableLaw, such Business Employee’s (to the extent applicable) name, title (including whether an employee, independent contractor orother service provider), and employee identification number. The Seller has made available, or will make available as soon aspossible following the date hereof, but not less than 30 days prior to the Closing Date, to the Purchaser the following informationwith respect to each such Business Employee prior to the date hereof: (A) date of birth and years of employment/service, (B)employing or contracting legal entity, country, and location of employment or service, (C) rate of base salary, hourly wage rate, rateof commissions or retainer arrangement as in effect on the date of this Agreement, including any increases scheduled to take effectfollowing the date of this Agreement, (D) annual incentive cash bonus for 2021 at target and maximum payouts, (E) the amount ofannual cash bonus paid for 2019 and 2020 (or if not yet paid for 2020, the amount earned and to be paid), (F) immigration status(and, to the extent that the Business Employee requires a visa, work permit or employment pass or other legal or regulatory approvalfor his or her employment, type of visa, permit, pass, or approval and country of citizenship), (G) social security number, and (H)work email addresses (clauses (A) through (H), together, the “Additional Employee Data”). Section 3.10(a) of the Seller DisclosureSchedule is subject to change between the date hereof and the Closing Date and the Seller shall provide updated schedules that aremutually agreed by the Purchaser and the Seller, as well as updated Additional Employee Data to the extent necessary to reflect orrelate to such changes. The Seller shall update Section 3.10(a) of the Seller Disclosure Schedule and the Additional Employee Dataprovided to reflect changes in the Business Employees no less frequently than every 30 days and again no later than the ClosingDate, with each update to be mutually agreed in advance by the Purchaser and the Seller. The Seller represents and warrants to thePurchaser that each individual who is employed or retained by the Seller or any Subsidiary or Affiliate of the Seller primarily inconnection with the Business is identified on Section 3.10(a) of the Seller Disclosure Schedule.

b. Section 3.10(b) of the Seller Disclosure Schedule lists all material Seller Benefit Plans.

c. The Seller has provided or made available to the Purchaser, for each Seller Benefit Plan, true and completecopies of all current plan documents (including all amendments and modifications thereof) and a summary plan description (if any),or, to the extent not in writing, a summary of material terms thereof; the most recent determination or opinion letter from the IRSreceived with respect to each Seller Benefit Plan that is intended to be qualified under Section 401(a) of the Code, if any; and allmaterial correspondence and documentation, and all non-routine filings made, with any Governmental Authority with respect to eachSeller Benefit Plan within three years of the date hereof.

d. Each Seller Benefit Plan has been administered in compliance in all material respects with its terms andapplicable Laws; no claims, disputes, government audits,

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examinations or investigations are pending or, to the Knowledge of the Seller, threatened with respect to any Seller Benefit Plan,other than ordinary claims for benefits; and each Seller Benefit Plan that is intended to be qualified under Section 401(a) of theCode has received a currently effective favorable determination letter or, if applicable, can rely upon an opinion letter from the IRSas to the qualification of the prototype plan on which it is based, and, to the Knowledge of the Seller, nothing has occurred thatwould reasonably be expected to adversely affect such qualification.

Section 3.11 Labor Matters.

a. There are, and during the past three years there have been, no collective bargaining, labor union, or othersimilar employee representative agreements or arrangements that are applicable to any of the Business Employees.

b. During the past six years there have been no, and there are currently no, pending, or to the Knowledge of theSeller, threatened strikes or lockouts with respect to any Business Employees; union organizing efforts pending or, to theKnowledge of the Seller, threatened with respect to the Business or the Business Employees; unfair labor practice, labor dispute(other than routine individual grievances) or labor arbitration claims or proceedings pending or, to the Knowledge of the Seller,threatened in writing against the Business or with respect to the Business Employees; or slowdowns or work stoppages in effect or,to the Knowledge of the Seller, threatened with respect to the Business Employees.

c. The Seller and its Subsidiaries, as applicable, have complied in all material respects with all applicable Lawsrelating to labor and employment with respect to the Business and the Business Employees, including wages, salaries andcommissions, payment for hours worked, payment for overtime, payment for vacation and sick pay, employee and independentcontractor classifications, classification of Business Employees as exempt or non-exempt, collective bargaining, employmentdiscrimination, unemployment, occupational safety and health, immigration status, workers’ compensation, and the payment ofpayroll and similar Taxes, and are not liable for the payment of Taxes, fines, penalties or other amounts for failure to comply withany of the foregoing. There has been no “mass layoff” or “plant closing” (as defined by the WARN Act or any similar state or localLaw) with respect to the Business during the past three years or for which any Liabilities remain unsatisfied.

d. Neither the Seller nor any of its Subsidiaries is engaged in, nor has at any time engaged in, any unfair ordiscriminatory labor or employment practice, nor is any charge or complaint relating to any unfair or discriminatory labor oremployment practice pending or threatened against the Seller or any such Subsidiary with respect to the Business or the BusinessEmployees. Neither the Seller nor any of its Subsidiaries has any obligation to compensate or make any payment of any kind to anyBusiness Employee, director or officer, other than current obligations for payment of wages and salary, accrued but unused vacationpay and other benefits. All severance and employee pension plans applicable to Business Employees are funded to the full extentrequired by applicable Laws, and all amounts properly accrued as Liabilities with respect to any Business Employee, director orofficer that have not been paid have been properly accounted for on the Seller’s books. There is no accrued and outstanding, due butunpaid,

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payment (wages, allowances, and otherwise) or other benefit required to be provided to any current or former Business Employee,director or officer (including any outsourced workers or dispatched workers) under applicable Laws.

e. Except as set forth on Section 3.11(e) of the Seller Disclosure Schedule, (i) no Business Employee or otherindividual engaged by the Seller or any of its Subsidiaries primarily in connection with the Business as an independent contractor,temporary employee, leased employee or any other service provider compensated other than through reportable wages (as anemployee) has been improperly excluded from any Seller Benefit Plan, and (ii) none of the Seller or any of its Subsidiaries utilizesthe services of any leased employees within the meaning of Section 414(n) of the Code in connection with the Business.

Section 3.12 Taxes.

a. All income Tax Returns and all other material Tax Returns required to have been filed by the Seller withrespect to the Transferred Assets or the Business have been timely filed (taking into account any extension of time to file granted orobtained) and such Tax Returns are true, correct and complete in all material respects.

b. All income Taxes and all other material Taxes (whether or not shown on any Tax Return) required to be paidby the Seller with respect to the Transferred Assets or the Business have been timely paid.

c. No claim or deficiency for any material amount of Taxes has been proposed, asserted or assessed in writing byany Governmental Authority against the Seller in respect of the Transferred Assets or the Business, which remains unresolved orunpaid, except for any claims or deficiencies that are being contested in good faith by appropriate proceedings and are described onSection 3.12(c) of the Seller Disclosure Schedule. Within the last four years, no claim has been made by a Governmental Authorityin a jurisdiction where the Seller does not file Tax Returns with respect to the Business or any of the Transferred Assets that theSeller is or may be subject to taxation by that jurisdiction with respect to the Business or such Transferred Asset, which remainsunresolved.

d. There are no Encumbrances for Taxes (other than Permitted Encumbrances) upon any of the TransferredAssets or the Business.

e. There are no waivers or extensions of any statute of limitations currently in effect with respect to Taxes or TaxReturns with respect to the Business or the Transferred Assets (other than extensions that arise as a result of filing Tax Returns bythe extended due date therefor in the ordinary course of business).

f. The Seller is not a party to any Tax sharing, Tax allocation, Tax indemnity or similar agreement orarrangement with respect to the Transferred Assets or the Business.

g. The Seller is not a foreign person as defined in Treasury Regulations Section 1.1445-2(b)(2)(i).

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h. Notwithstanding anything to the contrary contained in this Agreement (including any other representationsand warranties contained in this Agreement), the representations and warranties contained in Section 3.10 and this Section 3.12 (A)are the sole and exclusive representations and warranties made by the Seller relating to Tax matters with respect to the TransferredAssets and the Business, including compliance with and liabilities arising under Tax Laws and (B) other than the representationscontained in Section 3.12(f) cannot be relied upon with respect to Taxes attributable to any Tax periods (or portions thereof)beginning after, or Tax positions taken after, the Closing Date.

Section 3.13 Material Contracts.

a. Section 3.13(a) of the Seller Disclosure Schedule sets forth a true and complete list of each of the followingContracts (excluding purchase orders) to which the Seller or any of its Subsidiaries is a party, and that relates primarily to theBusiness and is in effect as of the date of this Agreement (such contracts and agreements being “Material Contracts”):

i. (A) Contracts for the purchase of products, materials, supplies, goods, equipment or other assets or forthe receipt of services or (B) any other Contract, in each case, which provided for consideration or payments by the Seller orits Subsidiaries in excess of $350,000 in the aggregate in 2020;

ii. (A) Contracts for the sale or furnishing of products, materials, supplies, goods, equipment or otherassets or services by the Seller or its Subsidiaries to customers of the Business or (B) any other Contract, in each case, whichprovided for consideration or payments by such customers in excess of $350,000 in 2020 (any such Contracts, “SalesContracts”);

iii. Contracts with any Key Customer or Key Supplier;

iv. all Contracts that are material to the control of the quality or processing related to the products underthe Sales Contracts;

v. Contracts that (A) include a covenant not to compete or other covenant restricting the freedom of theBusiness to compete in any line of business with any Person or in any geographic area (including any exclusivity covenant),or a covenant not to solicit any individual or class of individuals for employment, (B) require the Business to purchase or sella minimum amount of products or services on an annual basis or grant “most favored nation” pricing or similar rights to anyPerson, or (C) relate to capacity reservations or include any obligation to accept orders;

vi. Contracts that involve the creation, assumption or guarantee of Indebtedness for an amount,individually or in the aggregate, in excess of $350,000, or the extension of credit to any Person (not involving accountsreceivable) or the creation of an Encumbrance on any Transferred Assets;

vii. Related Party Contracts;

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viii. Contracts relating to any partnership, joint venture or limited liability company of the Business, orinvolving the sharing of revenues, profits or royalties of the Business;

ix. Contracts relating to the acquisition or disposition of any Person, business, product line or realproperty (whether by merger, sale of stock, sale of assets or otherwise) (A) pursuant to which, after the Closing, the Businesswill have any obligations (contingent or otherwise) or (B) for consideration with an aggregate value of $350,000 or more;

x. all Contracts with distributors, sales representatives, sales consultants and sales agents with respect tothe Business, including but not limited to, all exclusive sales representative or exclusive distribution Contracts;

xi. Contracts under which the Business is lessor of or permits any third party to hold or operate anyOwned Real Property;

xii. Contracts requiring capital expenditures in excess of $350,000 in any one fiscal year;

xiii. leases, rental or occupancy agreements, licenses, installment and conditional sale agreements, andother Contracts that (A) provide for the ownership of, leasing of, title to, use of, or any leasehold or other interest in any realor personal property and (B) in the case of personal property, involve aggregate payments in excess of $350,000 in anycalendar year;

xiv. any Shared Contract;

xv. any Contract with any Governmental Authority;

xvi. any IP Agreement or Transferred IP Agreement, other than any: (A) Contract with a current or formeremployee or individual independent contractor of the Seller or any of its Subsidiaries entered into in connection with theengagement of that Person by the Seller or any of its Subsidiaries, which Contract includes a license from that Person to theSeller or one of its Subsidiaries to use Intellectual Property owned or sublicensable by that Person, but only where theIntellectual Property licensed thereunder is not specifically identified; or (B) Contracts for any commercially available off theshelf software that (1) is not material to the Business, (2) has not been modified or customized for use in the Business, and(3) is licensed to the Seller or any of its Subsidiaries for a one time or annual fee of $100,000 or less;

xvii. any Contract relating to the resolution or settlement of any actual or threatened Action that involves(A) the payment of money damages in excess of $100,000, individually or in the aggregate, or (B) any obligation (other thanthe payment of money damages) of the Seller with respect to the Business;

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xviii. all Contracts with Business Employees or independent contractors providing for annual basecompensation opportunity in excess of $100,000;

xix. all Contracts with Key Customers relating to access, sharing of data and other information for purposesof compliance with the Drug Laws; and

xx. any Contract not otherwise listed in this Section 3.13(a) that is material to the Business, taken as awhole.

b. The Seller has made available to the Purchaser true and complete copies of each Material Contract. EachMaterial Contract is valid and binding on the Seller and, to the Knowledge of the Seller, the counterparty thereto, is enforceable bythe Seller or a Subsidiary of the Seller in accordance with its terms and is in full force and effect, subject to the effect of anyapplicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Laws relating to or affectingcreditors’ rights generally and subject to the effect of general principles of equity (regardless of whether considered in a proceedingat law or in equity). Neither the Seller nor, to the Knowledge of the Seller, any other party thereto, is in breach of or default, in anymaterial respect, under the terms of, or has provided or received any notice of material breach, material default or intention toterminate, any Material Contract. To the Knowledge of the Seller, no event or circumstance has occurred, and there does not existany event or circumstance that, with or without notice or lapse of time or both, would, or would reasonably be expected to, constitutean event of material default under any Material Contract or result in or permit a termination thereof or would cause or permit theacceleration of or other material changes of or to any right or obligation or the loss of any material benefit thereunder. There are nomaterial disputes pending or, to the Seller’s Knowledge, threatened, under any Material Contract.

Section 3.14 Environmental Matters.

a. Except as set forth on Section 3.14(a) of the Seller Disclosure Schedule, the Seller is conducting, and hasconducted during the last six years, the Business and the Transferred Assets in compliance in all material respects with applicableEnvironmental Law; in connection with the Business, the Seller has obtained and is in compliance in all material respects with allEnvironmental Permits that are necessary to conduct the Business and the Transferred Assets in the manner currently conducted andall applications for renewals necessary for continuity of such Environmental Permits have been timely filed and, to Seller’sKnowledge, all such Environmental Permits are transferrable to the Purchaser except Seller’s Tyrone pesticide establishmentregistration, EPA Establishment 3377-PA-001; there are no Hazardous Materials (A) present at, on, about, under or migrating to orfrom either the Manufacturing Facilities, the Owned Real Property or any other real property (including all buildings, improvementsand fixtures located thereon) currently owned, leased or operated in connection with the Business or, to the Seller’s Knowledge, anyreal property formerly owned, leased or operated in connection with the Business or (B) that have been disposed of, transported, orarranged for transportation by the Seller or any of its Subsidiaries, or any of their respective predecessors, in connection with theBusiness, to any place or location that, in each case, require Remedial Action or otherwise could reasonably be expected to result inmaterial Liabilities on

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the part of the Business; and there is no Action pending or, to the Seller’s Knowledge, threatened in writing, in connection with theBusiness, against the Seller or its predecessors, that relates to any violation or alleged violation of, or any Liability or allegedLiability under, any applicable Environmental Law.

b. The Seller does not own nor does it require ownership of any pesticide product registrations under the FederalInsecticide, Fungicide and Rodenticide Act, 7 U.S.C. 346a, to conduct the Business.

c. The Seller has made available to the Purchaser true, correct and complete copies of all (A) Phase I or Phase IIenvironmental site assessment reports or (B) baseline environmental assessments or (C) environmental compliance reports or auditreports relating to the Business, the Manufacturing Facilities or the Owned Real Property to the extent such assessments and reportsin this subsection (c) were prepared in connection with the Seller’s purchase of the Manufacturing Facilities or during the last tenyears and are in the possession or control of the Seller, Environmental Permits required under applicable Environmental Laws for theownership and operations of the Business, the Manufacturing Facilities and the Owned Real Property, and all non-privilegedmaterial correspondence and documents relating to the Business’s compliance with, or liability under, applicable EnvironmentalLaw.

d. Notwithstanding anything in this Agreement to the contrary, the representations and warranties contained inthis Section 3.14 and, to the extent they specifically apply, Sections 3.3, 3.19 and 3.20 are the only representations and warrantiesbeing made by the Seller in this Agreement with respect to matters arising under applicable Environmental Laws or EnvironmentalPermits related to the Business, the Owned Real Property, or the other Transferred Assets.

Section 3.15 Customers, Suppliers and Distributors.

a. Section 3.15(a) of the Seller Disclosure Schedule sets forth a true and complete list of the ten largestcustomers (measured by dollar volume of sales) of the Business during the 12-month period ended December 31, 2019 (the “KeyCustomers”).

b. Section 3.15(b) of the Seller Disclosure Schedule sets forth a true and complete list of the ten largest suppliers(measured by dollar volume of sales) of the Business during the 12-month period ended December 31, 2019 (the “Key Suppliers”).

c. Section 3.15(c) of the Seller Disclosure Schedule sets forth a true and complete list of the ten largestdistributors, sales representatives, sales consultants and sales agents (measured in terms of dollars paid by the Business) of theBusiness during the 12-month period ended December 31, 2019 (collectively, the “Key Distributors”).

d. Except as set forth in Section 3.15(d)(i) of the Seller Disclosure Schedule, since January 1, 2018, none of theKey Customers, Key Suppliers or Key Distributors has notified the Seller that it intends to cease or materially decrease purchasingfrom or selling to the Business, materially modify the terms on which it sells to or purchases from the Business

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(including any material changes in pricing or terms) as compared to past practices, or materially alter any purchases from or sales tothe Business. Except as set forth in Section 3.15(d)(ii) of the Seller Disclosure Schedule, since January 1, 2020, except in connectionwith normal expiration of Contracts in the ordinary course of business, no Key Supplier, Key Customer or Key Distributor has (A) ceased or decreased materially its purchasing from or selling to the Business from the levels achieved during the 12-month periodended December 31, 2019, (B) made any material adverse change in the terms and conditions on which it was doing business withthe Seller and its Subsidiaries with respect to the Business as of the 12-month period ended December 31, 2019 or (C) materiallyaltered any purchases from or sales to the Business. There is no pending or, to the Knowledge of the Seller, threatened materialdispute or controversy with any Key Supplier, Key Customer or Key Distributor.

Section 3.16 Inventory

. All Transferred Inventory was manufactured, purchased, acquired or ordered, and has been maintained, in the ordinary course ofbusiness and consistent with the regular past inventory practices of the Seller and, with respect to the Business, with the exception of“off-spec” inventory held for rework, is of a quality useable and saleable in the ordinary course of business and fit for the purposefor which it was manufactured, purchased, acquired or ordered. The quantities of each item of Transferred Inventory are consistentwith the regular past inventory practices of the Seller with respect to the Business. All Transferred Inventory is carried on the booksand records of the Seller at the lower of cost or net realizable value in accordance with GAAP, which value is reasonable based uponthe current operations of the Business and is not subject to any material write-down or write-off. All labor and overhead costsreflected in the value of Transferred Inventory were capitalized in accordance with GAAP.

Section 3.17 Title to Assets; Sufficiency of Assets

. The Seller, or a Subsidiary of the Seller, has good, valid and marketable title to or, in the case of leased or licensed assets, a validleasehold interest or license in, all of the Transferred Assets (other than the Owned Real Property, which is addressed in Section3.9), free and clear of all Encumbrances other than Permitted Encumbrances. The Transferred Assets that are tangible assets of anykind or description (including the Equipment) are in good operating condition and repair in all material respects, ordinary wear andtear excepted, and suitable in all material respects for their current use and have been maintained in accordance with writtenstandards, policies and procedures of the Business as made available to the Purchaser. The Transferred Assets and the employmentof the Business Employees, together with the services and assets to be provided, the licenses to be granted and the otherarrangements contemplated by this Agreement or the other Transaction Documents, constitute (and immediately following theClosing, will constitute) all of the assets, rights and properties necessary to conduct the Business on or immediately after the ClosingDate in the same manner as currently conducted by the Seller.

Section 3.18 Brokers

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. Except for Bank of America, no broker, finder or investment banker is entitled to any brokerage, finder’s or other fee orcommission in connection with the transactions contemplated by this Agreement or the other Transaction Documents based uponarrangements made by or on behalf of the Seller. The Seller shall be solely responsible for the fees and expenses of Bank ofAmerica.

Section 3.19 Governmental Licenses and Permits.

a. The Seller holds, and is operating in compliance in all material respects with, and in the past three years hasoperated in compliance in all material respects with, all Transferred Permits. All such Transferred Permits are in full force andeffect. Section 3.19 of the Seller Disclosure Schedule contains a true, correct and complete list of the Transferred Permits.

b. To the Knowledge of the Seller, the Seller has fulfilled and performed all of its material obligations withrespect to the Transferred Permits, and no event has occurred which allows, and, to the Knowledge of the Seller, there does not existany event or circumstances which, with or without notice or lapse of time or both, would allow, revocation or termination thereof orresults in any other material impairment of the rights of the holder of any Transferred Permit. No Action is pending or, to theKnowledge of the Seller, threatened to revoke, withdraw, suspend, cancel, terminate, materially modify, or limit any TransferredPermit, and there are no facts or circumstances (including the consummation of the transactions contemplated by the TransactionDocuments) that are reasonably likely to give rise to any material adverse change in any Transferred Permit or any failure tomaterially comply with applicable Laws or any term or requirement thereof in any material respect.

Section 3.20 Product Liability; Product Warranties

. The Seller has provided the Purchaser complete and accurate copies or forms of all written customer warranties currently in effectwith respect to the Business (and accurate written summaries of all oral customer warranties) other than customer purchase ordersthat deviate from the standard terms of the Seller’s form purchase order. Except as set forth on Section 3.20 of the Seller DisclosureSchedule, there is not, and during the last three years, there has not been any claim pending or, to the Knowledge of the Seller,threatened against the Seller with respect to the Business for any product returns, product liability or warranty obligations relating toany products or services of the Business that are, or were during such period, manufactured, produced, marketed, distributed or soldby or for the Business (such products and services, collectively the “Business Products”) with a value of more than $350,000individually or in the aggregate, the Business Products, and the manufacturing, production, marketing, sale and distribution thereof,comply, and in the last three years have complied in all material respects with all applicable Laws, there are not, and during the lastthree years, there have not been any defects or deficiencies in any such Business Products that have resulted, or would reasonably beexpected to result in a claim or claims against the Business with a value of greater than $350,000, individually or in the aggregate,and none of the Business Products designed, manufactured, packaged, labeled, shipped or sold by the Seller in the last three yearshas been subject to, or is subject to, any recall mandated by any Governmental Authority or is being, or has been in the

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last three years, demanded or requested in writing by any customer and, to the Knowledge of the Seller, there exist no facts orcircumstances that would be reasonably likely to result in any such recall.

Section 3.21 Transferred Accounts Receivable

. All of the Transferred Accounts Receivable arise from bona fide transactions of the Business and as of the date hereof, the Sellerhas not received written notice of any valid claims or set offs or other defenses or counterclaims with respect to such TransferredAccounts Receivable (including any notices pursuant to which an obligor is refusing to pay, or contesting payment of, all or amaterial portion of any Transferred Accounts Receivable). Since December 31, 2019, there have been no write-offs in excess of$200,000 of any receivables that would comprise Transferred Accounts Receivable if in existence as of the date hereof.

Section 3.22 Drug Laws.

a. The Seller is, and for the past three years has been, operating the Business in compliance with all applicableDrug Laws in all material respects. Except as set forth in Section 3.22(a) of the Seller Disclosure Schedule, in connection with theBusiness, the Seller has not received any FDA Form 483 (Inspectional Observations) or FDA Establishment Inspection Reports inthe last three years. Seller has made available to Purchaser copies of all documentation received from the FDA and any otherGovernmental Authority concerning the Business, together with all responses thereto.

b. In connection with the Business, the Seller and its agents and contractors have processed, developed,investigated, tested, manufactured, prepared, assembled, processed, packaged, labeled, stored, sold, distributed, marketed andpromoted the products, as applicable, in compliance in all material respects with the Drug Laws and good manufacturing practices.In connection with the Business, the Seller has all necessary and applicable Permits required by United States or comparable state orforeign Governmental Authorities, to permit the processing, manufacture, labeling, storage, importation, exportation, sale,distribution, marketing and promotion of the products in jurisdictions where such persons currently conduct such activities; and arein compliance, in all material respects, with all terms and conditions of each such Permit, and, to the Knowledge of the Seller, noevent has occurred or condition or state of facts exists which would constitute a material breach or material default under, or wouldcause revocation or termination of any such Permit.

c. In connection with the Business, the Seller has not received any notice or other communication from the FDAor any other Governmental Authority contesting the processing, development, investigation, testing, manufacturing, preparing,assembling, processing, packaging, labeling, storage, uses, labeling, marketing, distribution, or sale of any product, or otherwisealleging any violation of any Drug Law applicable to any product.

d. In connection with the Business, neither the Seller, nor any officer or employee of the Seller, or any of theirrespective Affiliates: is subject to any obligation arising under any inspection, investigation, warning letter, notice of violation letter,suit, claim, action,

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injunction, or proceeding relating to or arising under the FDCA or related regulations; is the subject of any civil or criminalproceedings that involve a matter within or related to the FDA’s or any other Governmental Authority’s jurisdiction under the DrugLaws; has engaged in any conduct for which such person has been or could reasonably be expected to be subject to a civil moneypenalty or criminal penalty under the FDCA; is listed on any FDA Debarment List, or has made an untrue statement of a materialfact or fraudulent statement to any Governmental Authority, failed to disclose a material fact required by applicable Law to anyGovernmental Authority, or committed an act, made a statement, or failed to make a statement that, at the time such disclosure wasmade, would reasonably be expected to constitute a material violation of any Drug Laws.

e. In connection with the Business, the Seller maintains all necessary licenses and registrations required underthe Drug Laws and has provided the Purchaser with all relevant documentation and reports relating to these licenses andregistrations.

Section 3.23 Insurance

. With respect to the Business, the Seller maintains the general liability, product liability and other types of insurance of the type andin such amounts customarily maintained by Persons conducting businesses similar to the Business. All insurance policies maintainedby the Seller with respect to the Business and the Transferred Assets are in full force and effect, shall be maintained until Closing,and are sufficient for compliance in all material respects with applicable Laws. The Seller has not received notice of, nor to theKnowledge of the Seller is there threatened, any cancellation, termination or reduction of coverage with respect to any such policy.There are no known and incurred but unreported material claims thereunder in respect of the Business or any Transferred Assets.

Section 3.24 Relationships with Related Parties

. Except as set forth on Section 3.24 of the Seller Disclosure Schedule, no Related Party of the Seller has any interest in anyproperty (real, personal, or mixed and whether tangible or intangible), used in or pertaining to the Business as currently conductedand except for the ownership of less than 2% of the outstanding common stock of a publicly-held corporation, owns of record or asa beneficial owner, an equity interest or any other financial interest in a Person that has had business dealings or a material financialinterest in any transaction with the Business.

Section 3.25 Investment Representations.

a. The Seller is an “accredited investor” as defined in Rule 501(a) under the Securities Act of 1933, as amended(the “Securities Act”), is acquiring the Preferred Equity for its own account and not with a view to the distribution thereof, and hasno present intention of selling, granting any participation in or otherwise distributing the Preferred Equity. Seller understands andacknowledges that (i) none of the Preferred Equity have been registered under the Securities Act or any state or foreign securitiesLaws, in reliance upon specific exemptions thereunder for transactions not involving any public offering, (ii) none of the PreferredEquity

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are traded or tradable on any securities exchange or over-the-counter, and (iii) the Preferred Equity may not be sold, transferred,offered for sale, pledged, hypothecated or otherwise disposed of except as permitted under the SPV Operating Agreement and unlesssuch transfer, sale, assignment, pledge, hypothecation or other disposition is pursuant to the terms of an effective registrationstatement under the Securities Act and are registered under any applicable state or foreign securities Laws or pursuant to anexemption from registration under the Securities Act and any applicable state or foreign securities Laws.

b. The Seller acknowledges that, except as set forth in this Agreement and the SPV Operating Agreement, thePurchaser and the SPV have made no representations, warranties, agreements or undertakings to the Seller with respect to thetransactions contemplated hereby and by the other Transaction Documents. The Purchaser further represents and warrants that, inexecuting and delivering this Agreement and the other Transaction Documents to which it is a party, it has not relied on anystatement or representation other than the Purchaser’s and the SPV’s representations and warranties and statements set forth inArticle IV and the SPV Operating Agreement.

Section 3.26 Disclaimer of the Seller.

a. EXCEPT AS EXPRESSLY SET FORTH IN THIS ARTICLE III OR IN ANY OTHER TRANSACTIONDOCUMENT AND NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, NONE OF THE SELLER, ITSSUBSIDIARIES OR THEIR REPRESENTATIVES MAKES OR HAS MADE ANY REPRESENTATION OR WARRANTY,EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, IN RESPECT OF THE BUSINESS, ANY OF THE TRANSFERREDASSETS OR THE ASSUMED LIABILITIES. NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, EXCEPTAS EXPRESSLY SET FORTH IN THIS ARTICLE III OR IN ANY OTHER TRANSACTION DOCUMENT, NONE OF THESELLER, ITS SUBSIDIARIES OR THEIR REPRESENTATIVES MAKES OR HAS MADE ANY REPRESENTATION ORWARRANTY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, WITH RESPECT TO (I) THE EXCLUDED ASSETS ORTHE EXCLUDED LIABILITIES; (II) MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR USE OR PURPOSE ORANY OTHER WARRANTIES ARISING UNDER THE UNIFORM COMMERCIAL CODE (OR SIMILAR LAWS); (III) THEOPERATION OF THE BUSINESS BY THE PURCHASER ON OR AFTER THE CLOSING DATE; OR (IV) THE PROBABLESUCCESS, PROFITABILITY OR PROSPECTS OF THE BUSINESS ON OR AFTER THE CLOSING DATE AND ANY SUCHREPRESENTATION OR WARRANTY IS HEREBY EXPRESSLY DISCLAIMED.

b. EXCEPT IN CONNECTION WITH THE REPRESENTATIONS AND WARRANTIES SET FORTH INTHIS ARTICLE III OR IN ANY OTHER TRANSACTION DOCUMENT, THE COVENANTS AND OBLIGATIONS OF THESELLER SET FORTH HEREIN AND THEREIN AND THE INDEMNIFICATION PROVIDED IN ARTICLE VIII OR IN ANYOTHER TRANSACTION DOCUMENT WITH RESPECT THERETO, NONE OF THE SELLER, ITS SUBSIDIARIES ORTHEIR REPRESENTATIVES WILL HAVE OR BE SUBJECT TO ANY LIABILITY OR INDEMNIFICATION OBLIGATIONTO THE

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PURCHASER, ITS REPRESENTATIVES OR TO ANY OTHER PERSON RESULTING FROM THE PROVISION TO THEPURCHASER OR ITS REPRESENTATIVES, OR THE PURCHASER’S OR ITS REPRESENTATIVES’ USE OF, ANYINFORMATION RELATING TO THE BUSINESS, INCLUDING THE CONFIDENTIAL MANAGEMENT PRESENTATIONAND ANY INFORMATION, DOCUMENTS, PROJECTIONS, FORECASTS, BUSINESS PLANS, OFFERING MATERIALSOR OTHER MATERIAL MADE AVAILABLE TO THE PURCHASER OR ITS REPRESENTATIVES OR POTENTIALFINANCING SOURCES, WHETHER ORALLY OR IN WRITING, IN CERTAIN “DATA ROOMS,” MANAGEMENTPRESENTATIONS, FUNCTIONAL “BREAK-OUT” DISCUSSIONS, “EXPERT SESSIONS,” SITE TOURS OR VISITS,DILIGENCE CALLS OR MEETINGS, RESPONSES TO QUESTIONS SUBMITTED ON BEHALF OF THE PURCHASER ORITS REPRESENTATIVES OR IN ANY OTHER FORM IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATEDBY THIS AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS, IN EACH CASE, OTHER THAN IN THE CASEOF FRAUD.

Article IV.

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND SPVThe Purchaser and the SPV hereby represent and warrant to the Seller, subject to such exceptions as are disclosed in the

Purchaser Disclosure Schedule, as follows:

Section 4.1 Organization, Authority and Qualification of the Purchaser

. The Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the State of Connecticut andhas all necessary corporate power and authority to enter into this Agreement and the other Transaction Documents to which it is aparty, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby.The SPV is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delawareand has all necessary limited liability company power and authority to enter into this Agreement and the other TransactionDocuments to which it is a party, to carry out its obligations hereunder and thereunder and to consummate the transactionscontemplated hereby and thereby. The execution and delivery by each of the Purchaser and the SPV of this Agreement and the otherTransaction Documents to which it is a party, the performance by each of the Purchaser and the SPV of its obligations hereunder andthereunder and the consummation by each of the Purchaser and the SPV of the transactions contemplated hereby and thereby havebeen duly authorized by all requisite action on the part of the Purchaser and the SPV, respectively. This Agreement has been, andupon their execution, the other Transaction Documents to which the Purchaser or the SPV is a party, will be, duly executed anddelivered by the Purchaser or the SPV, as applicable. Assuming due authorization, execution and delivery by the Seller, thisAgreement constitutes, and upon their execution, each of the other Transaction Documents to which the Purchaser or the SPV, asapplicable, is a party, will constitute, a legal, valid and binding obligation of the Purchaser or the SPV, enforceable against thePurchaser or the SPV in accordance with their respective terms, subject to the effect of any applicable bankruptcy, insolvency,fraudulent conveyance, reorganization, moratorium or

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other similar Laws relating to or affecting creditors’ rights generally and subject to the effect of general principles of equity(regardless of whether considered in a proceeding at law or in equity).


. Assuming that all consents, approvals, authorizations and other actions described in Section 4.3 or set forth in Section 4.2 of thePurchaser Disclosure Schedule or Section 7.1(b) of the Seller Disclosure Schedule have been obtained, all filings and notificationsdescribed in Section 4.3 or set forth in Section 4.2 of the Purchaser Disclosure Schedule or Section 7.1(b) of the Seller DisclosureSchedule have been made, any applicable waiting period has expired or been terminated, the execution, delivery and performance bythe Purchaser of this Agreement and each of the other Transaction Documents to which the Purchaser or the SPV, as applicable, is aparty and the consummation by the Purchaser or the SPV of the transactions contemplated hereby and thereby, do not and will not violate, conflict with or result in the breach of any provision of the certificate of incorporation or bylaws (or similar organizationaldocuments) of the Purchaser or the SPV; conflict with or violate any Law or Governmental Order applicable to the Purchaser or theSPV; or conflict with, result in any breach of, constitute a default (or an event which, with or without the giving of notice or lapse oftime, or both, would become such a default) under, require any consent under, or give to others any rights of termination,amendment, acceleration or cancellation of, any material Contract to which the Purchaser or the SPV is a party, except, in the case ofclauses (b) and (c), as would not materially and adversely affect the ability of the Purchaser and the SPV to carry out theirobligations under, and to consummate the transactions contemplated by, this Agreement or the other Transaction Documents.

Section 4.3 Governmental Consents and Approvals

. The execution, delivery and performance by each of the Purchaser and the SPV of this Agreement and each Transaction Documentto which it is a party does not require any consent, approval, authorization or other order or declaration of, action by, filing with ornotification to, any Governmental Authority, other than compliance with, and filings under, the HSR Act and any other applicablefilings and approvals in the jurisdictions set forth on Section 7.1(b) of the Seller Disclosure Schedule and any other applicableAntitrust Laws; or where the failure to obtain such consent, approval, authorization or action, or to make such filing or notification,would not prevent or materially delay the consummation by the Purchaser of the transactions contemplated by this Agreement or theother Transaction Documents.

Section 4.4 Litigation

. There is no Action by or against the Purchaser or any of its Subsidiaries (including the SPV) pending or, to the knowledge of thePurchaser or the SPV, threatened before any Governmental Authority, that would materially and adversely affect the legality,validity or enforceability of this Agreement or any other Transaction Document to which Purchaser or the SPV is a party or wouldprevent or materially delay the consummation of the transactions contemplated by this Agreement or the other TransactionDocuments.

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Section 4.5 Brokers

. Except for Goldman Sachs & Co. and Moelis & Company LLC, no broker, finder or investment banker is entitled to any brokerage,finder’s or other fee or commission in connection with the transactions contemplated by this Agreement or the other TransactionDocuments based upon arrangements made by or on behalf of the Purchaser or the SPV. The Purchaser shall be solely responsiblefor the fees and expenses of Goldman Sachs & Co. and Moelis & Company LLC.

Section 4.6 Debt Financing

.

a. The Purchaser has delivered to the Seller a true, correct and complete and fully executed copy of the debtcommitment letter, dated on or about the date hereof, among the Purchaser and the lender party thereto (as the same may beamended or replaced pursuant to Section 5.13(c), the “Debt Commitment Letter”), pursuant to which the lender party thereto hasagreed, upon the terms and subject to the conditions of the Debt Commitment Letter, to lend the amounts set forth in the DebtCommitment Letter for the purposes of financing the transactions contemplated by this Agreement (the “Debt Financing”). The DebtCommitment Letter and the related fee letter are referred to collectively in this Agreement as the “Debt Financing Agreements”.

b. As of the date hereof, each commitment represented by the Debt Financing Agreements is a legal, valid andbinding obligation of the Purchaser (except as the enforceability thereof may be limited by bankruptcy, insolvency, moratorium,fraudulent conveyance and other similar Laws affecting creditors’ rights generally and by general principles of equity), and to theknowledge of the Purchaser, the other parties thereto. None of the Debt Financing Agreements has been amended or modified priorto the date hereof and none of the respective commitments contained in the Debt Financing Agreements have been withdrawn,modified or rescinded in any respect as of the date hereof. Except for the fee letter relating to the Debt Financing (a complete copyof which has been provided to the Seller, with only the fee amounts, other economics and market flex (none of which wouldadversely affect the full amount or availability of the Debt Financing) redacted), as of the date hereof, there are no side letters orother agreements, contracts or arrangements related to the funding or investment, as applicable, of the Debt Financing other than asexpressly set forth in the Debt Financing Agreements.

c. The Purchaser has paid (or caused to be paid) any and all commitment fees or other fees payable by it (or itsAffiliates) in connection with the Debt Financing Agreements that were payable on or prior to the date hereof. The only conditionsprecedent or other contingencies related to the obligations of the Financing Sources to fund the full amount of Debt Financing arethose expressly set forth in or contemplated by the Debt Commitment Letter. As of the date hereof, no event had occurred which,with or without notice, lapse of time or both, would constitute a default or breach on the part of the Purchaser, or to the knowledge ofthe Purchaser, any Financing Source, under any term of the Debt Financing Agreements. Subject to the satisfaction of the conditionsset forth in Article VII and the completion of the Marketing

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Period, as of the date hereof, the Purchaser has no reason to believe that it would be unable to satisfy on a timely basis any term orcondition of the Debt Financing Agreements required to be satisfied by it on or prior to the Closing Date.

d. The Purchaser represents that it will have at the Closing adequate funds, not including any proceeds receivedfrom the Debt Financing, to purchase the Transferred Assets and assume the Assumed Liabilities at Closing and that it willconsummate the transactions described in this Agreement. After giving effect to the transactions contemplated by this Agreementand assuming the accuracy of the representations and warranties of the Seller set forth in Article III, the Purchaser will not (i) beinsolvent (either because its financial condition is such that the sum of its debts is greater than the fair value of its assets or becausethe fair salable value of its assets is less than the amount required to pay its probable Liability on its existing debts as they mature),(ii) have unreasonably small capital with which to engage in its business, or (iii) have incurred debts beyond its ability to pay as theybecome due.

Section 4.7 Operations of the SPV

. The SPV is a wholly-owned Subsidiary of the Purchaser and was organized solely for the purpose of entering into this Agreementand the other Transaction Documents to which it is a party and consummating the transactions contemplated hereby and thereby andhas not engaged in any activities or business, and has incurred no liabilities or obligations whatsoever, in each case, other than thoseincident to its organization and the execution of this Agreement and the consummation of the transactions contemplated hereby.

Section 4.8 Issuance of Preferred Equity

. Upon the due execution of the SPV Operating Agreement, and the consummation of the Closing in accordance with the terms ofthis Agreement, the Preferred Equity shall have been duly authorized and validly issued and shall be non-assessable and free andclear of all Encumbrances (other than those arising under applicable federal and state securities Laws), and no further payment orcontribution shall be required with respect thereto, and assuming the accuracy of the representations and warranties of the Seller setforth in Section 3.25, shall have been issued in compliance with all applicable federal and state securities Laws. The Purchaser ownsall of the common membership interests of the SPV (the “Common Interests”), which constitute, as of the date hereof and shallconstitute immediately prior to the issuance of the Preferred Equity to the Seller at the Closing, all of the authorized and issuedmembership interests and other equity interests in the SPV. The Common Interests have been duly authorized and validly issued andare non-assessable and free and clear of all Encumbrances (other than those arising under applicable federal and state securitiesLaws), and no further payment or contribution is required with respect thereto. There are no outstanding securities convertible into,or exchangeable for, or authorized options, warrants, purchase rights, subscription rights, conversion rights, exchange rights, or othercontracts or commitments that could require the Purchaser or the SPV to issue, sell, or otherwise cause to become outstanding, anyCommon Interests, Preferred Units or other membership interests or equity interests in the SPV. There are no agreements, including,without limitation, relating to registration rights, investor rights, co-sale rights, rights of first refusal, preemptive rights, voting orother similar agreements or

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understandings to which the Purchaser is a party or is bound with respect to the SPV or to which the SPV is a party or is bound.There are no outstanding Plans with respect to the SPV, and there are no outstanding stock appreciation, phantom stock, profitparticipation or similar rights with respect to the membership interests of the SPV. Immediately after the Closing, the Purchaser willown 100% of the Common Interests, and the Seller will own 100% of the Preferred Units.

Section 4.9 Independent Investigation; Seller’s Representations.

a. The Purchaser has conducted to its satisfaction its own independent investigation, review and analysis of thebusiness, operations, assets, Liabilities, results of operations, financial condition, software, technology and prospects of the Business,which investigation, review and analysis was performed by the Purchaser and its Representatives. The Purchaser acknowledges thatit and its Representatives have been provided adequate access to the personnel, properties, facilities and records of the Business forsuch purpose. In entering into this Agreement, the Purchaser acknowledges that it has relied upon its own investigation, review andanalysis and, except as otherwise provided in this Agreement, not on any statements, representations or opinions of the Seller or anyof its Representatives (except the specific representations and warranties of the Seller set forth in Article III or any other TransactionDocument).

b. The Purchaser hereby acknowledges and agrees that notwithstanding anything herein to the contrary otherthan the specific representations and warranties made in Article III or in any other Transaction Document, none of the Seller, itsSubsidiaries or their Representatives makes or has made, and the Purchaser has not and is not relying on, any representation orwarranty, express or implied, at law or in equity, in respect of the Business, any of the Transferred Assets or the Assumed Liabilities,including with respect to (A) the Excluded Assets or the Excluded Liabilities; (B) merchantability or fitness for any particular use orpurpose or any other warranties arising under the Uniform Commercial Code (or similar Laws); (C) the operation of the Business bythe Purchaser after the Closing Date; or (D) the probable success, profitability or prospects of the Business after the Closing Date;and none of the Seller, its Subsidiaries or their Representatives will have or be subject to any liability or indemnification obligationto the Purchaser, its Representatives or to any other Person resulting from the distribution to the Purchaser or its Representatives of,or the Purchaser’s or its Representatives’ use of, any information relating to the Business, including the Confidential ManagementPresentation and any information, documents, offering materials or other material made available to the Purchaser or itsRepresentatives or potential financing sources, whether orally or in writing, in certain “data rooms,” management presentations,functional “break-out” discussions, “expert sessions,” site tours or visits, diligence calls or meetings, responses to questionssubmitted on behalf of the Purchaser or its Representatives or in any other form in connection with the transactions contemplated bythis Agreement or the other Transaction Documents, in each case, other than in the case of fraud. The Purchaser and itsRepresentatives have received and may continue to receive from the Seller, its Subsidiaries and their Representatives certainestimates, projections, forecasts, plans and budgets for the Business and certain plan and budget information. The Purchaseracknowledges that these estimates, projections, forecasts, plans and budgets and the assumptions on which they are based wereprepared for specific purposes and

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may vary significantly from each other. Further, the Purchaser acknowledges that there are uncertainties inherent in attempting tomake such estimates, projections, forecasts, plans and budgets, that the Purchaser is taking full responsibility for making its ownevaluation of the adequacy and accuracy of all estimates, projections, forecasts, plans and budgets so furnished to it, and that thePurchaser is not relying on any estimates, projections, forecasts, plans or budgets furnished by the Seller or its Representatives, andthe Purchaser shall not, and shall cause its Representatives not to, hold any such Person liable with respect thereto, other than in thecase of fraud.

Article V.

ADDITIONAL AGREEMENTSSection 5.1 Conduct of Business Prior to the Closing

. From the date of this Agreement and until the earlier of the Closing Date and the date on which this Agreement is validlyterminated pursuant to Section 9.1 (except as set forth in Section 5.1 of the Seller Disclosure Schedule, as expressly required by thisAgreement, the other Transaction Documents or applicable Law or any COVID Action or as the Purchaser shall otherwise consentto in writing (such consent not to be unreasonably withheld, delayed or conditioned)), (A) the Seller shall, and shall cause itsSubsidiaries to, use commercially reasonable efforts to (I) conduct the Business in the ordinary course consistent with past practice;(II) preserve intact in all material respects the business organization of the Business and maintain the Transferred Assets; and (III)preserve the goodwill of the customers, suppliers and others having business relations with the Business; and (B) without limitingthe generality of the foregoing, the Seller shall not, and shall cause its Subsidiaries not to, to the extent relating to the Business or theTransferred Assets:

i. subject, or permit or allow any of the Transferred Assets (whether tangible or intangible) to besubjected to any Encumbrance, other than Permitted Encumbrances;

ii. change any method of accounting or accounting practice or policy used by the Seller as of the datehereof, other than such changes as are required by GAAP or a Governmental Authority;

iii. except as required by applicable Laws or the terms of any Seller Benefit Plans as they exist on the datehereof, (A) grant or announce any increase in the salaries, bonus opportunities or other compensation or benefits payable orto become payable to any of the Business Employees, other than any base salary, wage rate or bonus opportunity increasesmade in the ordinary course of business consistent with past practice; provided that any such increase shall not be greaterthan (1) 3% in the aggregate with respect to the aggregate base salaries and wages payable to all Business Employees and (2)6% with respect to the base salaries or wages payable to any individual Business Employee or (B) enter into or adopt anyemployee benefit plan or employment or severance agreement, or amend any Seller Benefit Plan, in each case, with respectto any Business Employee, other than changes in welfare benefits of the Seller or any of its

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Subsidiaries or Affiliates in the ordinary course of business consistent with past practice that apply equally to all similarlysituated employees of the Seller or any of its Subsidiaries or Affiliates, as the case may be;

iv. (A) sell, lease, sublease, license, abandon or otherwise transfer any Owned Real Property orTransferred Assets, other than sales of Transferred Inventory in the ordinary course of business or (B) acquire any assets thatare material to the Business, individually or in the aggregate, except for purchases of inventory in the ordinary course ofbusiness;

v. sell, license, abandon or otherwise transfer any Transferred Intellectual Property, other than non-exclusive licenses granted to customers in connection with the sale or provision of goods or services in the ordinary course ofbusiness consistent with past practice;

vi. (A) other than in the ordinary course of business consistent with past practice, (1) extend, amend,cancel or terminate, or waive any right under, any Material Contract or any Permit or (2) or enter into any Contract which, ifentered into prior to the date hereof, would be a Material Contract or Transferred Assets; or (B) enter into any Contract forthe sale or furnishing of products, materials, supplies, goods, equipment or other assets or services which (1) has a term inexcess of 12 months or (2) provides for annual payments to the Seller or any of its Subsidiaries in excess of $350,000;

vii. make, change, revoke or amend any material Tax election, file any material amended non-income TaxReturn, adopt or change any Tax accounting method which has a material impact on Taxes with respect to the operation ofthe Business or ownership of the Transferred Assets, adopt or change any Tax accounting period, enter into any closingagreement with any Governmental Authority with respect to a material amount of Taxes, or settle or compromise anymaterial Tax claim, in each case, to the extent such action is with respect to the Business or any of the Transferred Assets;

viii. acquire, by merger or consolidation with, or by purchase of all or a substantial portion of the assets orequity of, or by any other manner, any business or entity which would constitute a Transferred Asset or Assumed Liability;

ix. (A) incur any Indebtedness in excess of $350,000, individually or in the aggregate, or (B) make anyloans, advances or capital contributions to, or investments in, any other Person;

x. enter into any Contract that restricts the freedom of the Business or any of its existing or futureAffiliates to (A) compete in any line of business with any Person or in any geographic area or (B) solicit any individual orclass of individuals for employment;

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xi. settle or compromise any pending or threatened Action, other than settlements involving solely moneydamages in an amount not exceeding $100,000, individually or in the aggregate;

xii. disclose or allow to be disclosed any confidential information or trade secrets of the Business to anyPerson, other than (A) to employees of the Seller or its Subsidiaries and (B) to third parties, in each case that are subject to aconfidentiality or non-disclosure covenant protecting against further disclosure thereof;

xiii. fail to notify the Purchaser promptly of any material infringement, misappropriation or other violationof, or conflict with, any Transferred Intellectual Property of which the Seller or any of its Subsidiaries becomes aware and toconsult with the Purchaser regarding the actions (if any) to take to protect such Intellectual Property;

xiv. fail to (A) invoice customers and collect Transferred Accounts Receivable or (B) pay or discharge anyLiabilities when due, in each case, in the ordinary course of business consistent with past practice;

xv. allow levels of inventory to vary materially from the levels the Business maintains in the ordinarycourse of business;

xvi. adopt a plan or agreement of complete or partial liquidation, dissolution, merger, consolidation,restructuring, recapitalization or other material reorganization; or

xvii. agree to take any of the actions specified in Section 5.1(i)-(xvi).

Notwithstanding anything to the contrary in this Agreement, (A) the Seller shall be permitted to declare and pay any cashdividends or make cash distributions or cash transfers (including in connection with any “cash sweep” arrangements) prior to theClosing Date; (B) the Seller may settle any Indebtedness owing by the Seller or any of its Subsidiaries, including by repayment orcapitalization, prior to the Closing Date; (C) nothing contained in this Agreement shall be construed to give to the Purchaser directlyor indirectly, rights to control or direct the Business’s operations prior to the Closing; and (D) prior to the Closing, the Seller shallexercise, consistent with the terms and conditions of this Agreement, complete control and supervision of the operations of theBusiness.

Section 5.2 Access to Information and Manufacturing Facilities.

a. From the date of this Agreement until the Closing, upon reasonable notice, the Seller shall, and shall cause itsSubsidiaries to afford the Purchaser and its authorized Representatives reasonable access to the offices, properties (including theManufacturing Facilities and Owned Real Property) and books and records of the Business; and furnish to the authorizedRepresentatives of the Purchaser such additional available information regarding the Business (or copies thereof), as the Purchasermay from time to time reasonably request; provided, that (A) any such access or furnishing of information shall be conducted at the

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Purchaser’s expense, during normal business hours, under the supervision of the Seller’s personnel and in such a manner as not tointerfere with the normal operations of the Business; (B) all requests for access pursuant to this Section 5.2(a) shall be made inwriting and shall be directed to and coordinated with the Seller or a person or persons designated by the Seller in writing; and (C) thePurchaser shall not, and shall cause its Representatives not to, contact any of the employees, customers, distributors or suppliers ofthe Seller in connection with the transactions contemplated by this Agreement or the other Transaction Documents, whether inperson or by telephone, mail, or other means of communication, without the specific prior written authorization of the Seller.Notwithstanding anything to the contrary in this Agreement, the Seller shall not be required to provide any access or disclose anyinformation to the Purchaser or its Representatives if such disclosure would, in the Seller’s reasonable discretion (in the case ofclauses (2), (3) and (4), after consultation with outside counsel), (1) put the Seller or the Business at a competitive disadvantage ifthe transactions contemplated by this Agreement and the other Transaction Documents are not consummated; (2) jeopardize, orresult in a loss or waiver of, any attorney-client or other legal privilege; (3) contravene any applicable Law, fiduciary duty oragreement that exists on the date of this Agreement; or (4) result in disclosure of any proprietary information or trade secrets of theSeller, its Subsidiaries or third parties; provided that, in the cases of clauses (2), (3) and (4), the Seller shall notify the Purchaser inreasonable detail of the circumstances giving rise to such privilege, Law, duty, agreement or trade secret and cooperate to permitdisclosure of such information in a manner consistent herewith. When accessing any of the Seller’s properties, the Purchaser shall,and shall cause its Representatives to, comply with all of the Seller’s safety and security requirements for the applicable property.Notwithstanding anything to the contrary in this Agreement, (I) in no event shall the Seller be required to provide any informationexclusively relating to any Excluded Assets or any Excluded Liabilities, except to the extent such information is material to theBusiness or responsive to any of the representations of the Seller set forth in this Agreement; and (II) neither the Purchaser nor anyof its Representatives shall be allowed to sample or analyze any soil or groundwater or other environmental media, or any buildingmaterial, without the prior written consent of the Seller, which consent may be withheld in the sole discretion of the Seller. For theavoidance of doubt, the Purchaser or its Representatives shall be allowed to perform a Phase I ESA in accordance with ASTMStandard E1527-13 at the Owned Real Property located in Tyrone, Pennsylvania and complete the scope of work, includingproposed sampling locations, sample collection methods, media, analytes, analytical methods, quality control measures, andschedule for a Phase II ESA at the Owned Real Property located in South Haven, Michigan consistent with Exhibit F.

b. In order to facilitate the resolution of any claims made against or incurred by the Seller relating to theBusiness (other than any Action between the Purchaser and the Seller or any of their respective Affiliates arising from anyTransaction Documents) and for purposes of compliance with securities, environmental, employment, accounting and other Lawsand regulations including stock exchange rules and regulations, until the seventh anniversary of the Closing Date, the Purchaser shall retain the books and records and financial and operational data relating to the Business that are transferred to the Purchaser by theSeller or otherwise pursuant to this Agreement for periods prior to the Closing Date; and subject to applicable Law (includingattorney-client or other privilege) upon reasonable advance written notice, afford the

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Representatives of the Seller reasonable access (including the right to make, at the Seller’s expense, copies), during normal businesshours, to such books and records; provided, that (A) if any such information is or becomes comingled with books and records of thePurchaser and its Affiliates, the Purchaser shall be entitled to withhold, in its reasonable discretion, any information that does notrelate to the Business and (B) any such access or furnishing of information shall be conducted at the Seller’s expense, under thesupervision of the Purchaser’s personnel and in such a manner as not to interfere with the normal operations of the Business.

c. In order to facilitate the resolution of any claims made against, or incurred by, the Purchaser relating to theBusiness (other than any Action between the Purchaser and the Seller or any of their respective Affiliates arising from anyTransaction Documents) and for purposes of compliance with securities, environmental, employment, accounting and other Lawsand regulations, including stock exchange rules and regulations, until the seventh anniversary of the Closing Date, the Seller shall,and shall cause its Subsidiaries to, retain the books and records and financial and operational data relating to the Business relating toperiods prior to the Closing Date which did not constitute Transferred Records or Transferred Information; and subject to applicableLaw (including attorney-client or other privilege), upon reasonable notice, afford the Representatives of the Purchaser reasonableaccess (including the right to make, at the Purchaser’s expense, copies), during normal business hours, to such books and records.

Section 5.3 Confidentiality.

a. The terms of the confidentiality agreement, dated as of November 25, 2019 (the “ConfidentialityAgreement”), between the Seller and the Purchaser are hereby incorporated herein by reference and shall continue in full force andeffect until the Closing and shall survive the Closing and remain in full force and effect until their expiration in accordance with theterms of the Confidentiality Agreement; provided, however, that, upon the Closing, the confidentiality and non-use obligationscontained in the Confidentiality Agreement shall terminate in respect of that portion of the Confidential Information primarilyrelating to the Business and the transactions contemplated by this Agreement or the other Transaction Documents. If this Agreementis, for any reason, terminated prior to the Closing, the Confidentiality Agreement shall nonetheless continue in full force and effectin accordance with its terms.

b. Nothing provided to the Purchaser pursuant to Section 5.2(a) shall in any way amend or diminish thePurchaser’s obligations under the Confidentiality Agreement. The Purchaser acknowledges and agrees that, subject to Section 5.3(a),any Confidential Information made available to the Purchaser or its Representatives pursuant to Section 5.2(a) or otherwise by theSeller or any of its Representatives prior to the Closing Date shall be subject to the terms and conditions of the ConfidentialityAgreement.

c. Following the Closing, the Seller shall, and shall cause its Affiliates and its and their respectiveRepresentatives (collectively, “Seller Restricted Parties”) to maintain the confidentiality of, not use, and not divulge to any Person,any confidential, non-public or proprietary information concerning the Business and/or the Transferred Assets (including, for theavoidance of doubt, any information accessed or obtained by the Seller Restricted Parties

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pursuant to Section 5.2(b)) (such information, to the extent not exclusively related to the Business and/or the Transferred Assets, the“Shared Information”), in each case, except (A) with the prior written consent of the Purchaser; (B) if, based on the advice of outsidecounsel, such Seller Restricted Party is required to report such information in order to comply with (1) applicable securities Lawsand regulations, including stock exchange rules and regulations or (2) any other applicable Laws or a Governmental Order inconnection with a dispute with or claim by a third party; provided, that with respect to clause (2) such Seller Restricted Party shallprovide the Purchaser with prompt written notice of such requirement so that the Purchaser may seek an appropriate protective orderor other appropriate remedy, and such Seller Restricted Party shall reasonably cooperate with the Purchaser (at the Purchaser’srequest) to obtain such order or remedy; provided, further, that, in the event such order or remedy is not obtained, such SellerRestricted Party shall furnish only that portion of such information which, in the opinion of its outside counsel, it is legally requiredto disclose and shall exercise its commercially reasonable efforts (at the Purchaser’s request) to obtain reliable assurance thatconfidential treatment will be accorded any such information so disclosed; or (C) with respect to Shared Information, pursuant tonon-disclosure agreements (or license agreements containing non-disclosure obligations) that (1) obligate the recipient of suchShared Information to maintain the confidentiality thereof and not use such Shared Information and (2) impose perpetualconfidentiality obligations on the recipient with respect to trade secrets.

Section 5.4 Regulatory and Other Authorizations; Notices and Consents.

a. Each of the Purchaser and the Seller shall use its reasonable best efforts to, promptly obtain all authorizations,consents, orders and approvals of all Governmental Authorities that may be or become necessary for its execution and delivery of,and the performance of its obligations pursuant to, this Agreement and the other Transaction Documents; cooperate fully with theother party in promptly seeking to obtain all such authorizations, consents, orders and approvals; and provide such other informationto any Governmental Authority as such Governmental Authority may reasonably request in connection herewith. Each party heretoagrees to, and shall cause its respective Affiliates, as applicable, to, make, as promptly as practicable, (A) in any event no later thanten Business Days after the date of this Agreement, its respective filing, if necessary, pursuant to the HSR Act with respect to thetransactions contemplated by this Agreement or the other Transaction Documents and to supply as promptly as practicable to theappropriate Governmental Authorities any additional information and documentary material that may be requested pursuant to theHSR Act, and (B) in any event within 30 Business Days after the date of this Agreement, its respective filings and notifications, ifany, pursuant to any other applicable Antitrust Law in the jurisdictions set forth on Section 7.1(b) of the Seller Disclosure Schedulewith respect to the transactions contemplated by this Agreement, and to supply as promptly as practicable to the appropriateGovernmental Authorities any additional information and documentary material that may be reasonably requested pursuant to theapplicable Antitrust Law. The Purchaser shall pay all filing fees with respect any filings required pursuant to HSR Act or theAntitrust Laws in the jurisdictions set forth in Section 7.1(b).

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b. If, upon the Closing Date, any Governmental Authority has not transferred any Environmental Permit toPurchaser or, if any Environmental Permit is not transferrable (e.g., the Seller’s Tyrone pesticide establishment registration, EPAEstablishment 3377-PA-001), and any Governmental Authority has not issued a substantively equivalent Environmental Permit toPurchaser (each, a “Non-Transferred Environmental Permit”), then the Seller shall maintain such Non-Transferred EnvironmentalPermits in its name until the applicable Governmental Authority transfers or issues such Environmental Permit to the Purchaser.Immediately upon the Closing Date and to the extent allowed by and in accordance with applicable Law, the Seller shall grant orcause to be granted to the Purchaser the right to operate the Business, including the Transferred Assets, under each of the Non-Transferred Environmental Permits. From and after the date of this Agreement, the Seller will make available to the Purchaser eachperson who is required to sign all requisite transfer applications and other documents necessary to effect the transfer of or otherwiseobtain the Non-Transferred Environmental Permits, and the Seller shall cause such persons to execute and deliver all suchapplications and documents. As of the Closing Date and thereafter, the Seller will, without further consideration, cooperate to themaximum extent possible with the Purchaser to enter into any arrangement, including the execution of such documents andinstruments as may reasonably be deemed necessary or desirable to cause the Purchaser or its Affiliates to: (i) be allowed to operateunder the Non-Transferred Environmental Permits, including, without limitation, designating the Purchaser as an “operator”,“permittee”, or “licensee” under the Environmental Permits and approving and signing all operator change forms or revisionsprepared by the Purchaser at or immediately after the Closing; and (ii) receive transfer of or obtain such Non-TransferredEnvironmental Permits or to become the successor thereto as the Governmental Authority may require.

c. Notwithstanding anything to the contrary contained in Section 5.4(a) or elsewhere in this Agreement, neitherthe Purchaser nor any of its Affiliates shall have any obligation under this Agreement to divest or agree to divest (or cause any of itsAffiliates or the Seller to divest or agree to divest) any of the Purchaser’s assets, properties, businesses, or product lines or theTransferred Assets or to agree (or cause any of its Affiliates or the Seller to agree) to any limitation or restriction on any of its assets,properties, businesses, or product lines or the Transferred Assets and the Purchaser shall, and shall cause its Affiliates to, defendthrough litigation on the merits any Action by any Governmental Authority in order to avoid entry of, or to have vacated orterminated, any decree, order or judgment (whether temporary, preliminary or permanent) that would prevent the Closing prior to theTermination Date.

d. Each party shall not extend or consent to any extension of any applicable waiting or review period or enterinto any agreement with any Governmental Authority to not consummate the transaction contemplated by this Agreement, exceptupon the prior consent of the other party. Each party to this Agreement shall promptly notify the other party of any substantivecommunication it or any of its Representatives receives from any Governmental Authority relating to the matters that are the subjectof this Agreement and permit the other party to review in advance any proposed substantive communication by such party to anyGovernmental Authority. Each of the parties to this Agreement shall permit outside counsel of the other party to be present orparticipate in any materially substantive call, discussion or meeting with any Governmental Authority in respect of any filings,investigation (including any

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settlement of an investigation), litigation or other inquiry unless it consults with the other party in advance and unless prohibited bysuch Governmental Authority, gives the other party the opportunity to attend and participate in such call, discussion or meeting;provided that such consultation is not required by the Purchaser’s outside counsel to communicate with the GovernmentalAuthorities in the jurisdictions set forth in Section 7.1(b) of the Seller Disclosure Schedule, except to the extent the Seller hasengaged outside competition counsel in such jurisdiction. Each party hereto shall, and shall cause its Representatives to, coordinateand cooperate fully with each other in exchanging such information and providing such assistance as the other party hereto mayreasonably request in connection with the foregoing and in seeking early termination of any applicable waiting periods, includingunder the HSR Act. Each party to this Agreement shall, and shall cause its outside counsel to, provide the other party’s outsidecounsel with copies of all correspondence, filings (excluding the Purchaser’s HSR Form) or communications between the parties orany of their respective Representatives, on the one hand, and any Governmental Authority or members of its staff, on the other hand,with respect to this Agreement and the transactions contemplated by this Agreement or the other Transaction Documents; provided,however, that materials may be redacted (i) to remove references concerning the valuation of the Business and competitivelysensitive information; (ii) as necessary to comply with contractual arrangements or applicable Law; and (iii) as necessary to addressreasonable attorney-client or other privilege or confidentiality concerns.

e. Except as otherwise permitted pursuant to this Section 5.4, the Purchaser shall not, and shall cause itsAffiliates not to, enter into any merger, acquisition, or joint venture, or any agreement to effect any merger, acquisition, or jointventure that would reasonably be expected to make it materially more difficult, or to increase the time required by more than 30days, to obtain the expiration or termination of the waiting period under the HSR Act, or any other applicable Antitrust Law,applicable to the transactions contemplated by this Agreement or the other Transaction Documents or obtain all authorizations,consents, orders and approvals of Governmental Authorities necessary for the consummation of the transactions contemplated bythis Agreement or the other Transaction Documents.

Section 5.5 Retained Names and Marks.

a. The Purchaser hereby acknowledges that all right, title and interest in and to the “ALBEMARLE” and“ALBEMARLE CORPORATION” names and the Albemarle logo, together with all variations and acronyms thereof, and alltrademarks, service marks, Internet domain names, trade names, trade dress, company names and other identifiers of source and anyassociated Goodwill owned by the Seller other than the Transferred Intellectual Property (collectively, the “Retained Names andMarks”), are owned solely by the Seller or its Subsidiaries, and that, except as expressly provided in this Section 5.5, any and allright of the Business to use the Retained Names and Marks shall terminate as of the Closing and shall immediately revert to theSeller, along with any and all Goodwill associated therewith. Each of the Purchaser and its Subsidiaries further acknowledges thatneither the Purchaser nor any of its Subsidiaries is acquiring any rights on or after the Closing Date, to use the Retained Names andMarks after Closing, except for the rights expressly provided in Section 5.5(b).

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b. The Purchaser shall be entitled to use, solely in connection with the operation of the Business as operatedimmediately prior to the Closing Date, all of the existing stocks of signs, letterheads, labels, office forms, packaging, invoice stock,advertisements and promotional materials, inventory and other documents and materials that are included in the Transferred Assetsand contain the Retained Names and Marks (“Existing Stock”) for: with respect to any Existing Stock that constitutes exterior orinterior facility signage, a period of 90 days after the Closing and with respect to all other Existing Stock, the longer of (A) 90 daysafter the date of Closing and (B) 45 days after receipt by the Purchaser of any Existing Stock in transit as of the Closing Date, afterwhich period the Purchaser shall remove or obliterate all Retained Names and Marks from such Existing Stock or cease using suchExisting Stock; provided, however, that the Purchaser shall use commercially reasonable efforts to ensure that all such ExistingStock used by it hereunder following the Closing shall, to the extent practicable, display a notice, in a format reasonably acceptableto the Seller, indicating that the Business was formerly owned by the Seller, and is now owned and operated by the Purchaser.Notwithstanding anything to the contrary in this Section 5.6, the Purchaser (A) may, at all times after the Closing, (1) keep recordsand other historical or archived documents containing or referencing the Retained Names and Marks for record and archivalpurposes, and (2) refer to the historical fact that the Business was previously conducted under the Retained Names and Marks, (B)has no obligation to retrieve or alter any materials that display any Retained Names and Marks and are, as of the Closing, in thepossession and control of a third party, or to revise any Contracts, unless required by applicable Law, and (C) may use any RetainedNames and Marks (1) to the extent applicable Law would restrict the ability of the Purchaser or any of its Affiliates from operatingthe Business in any respect (but only while so restricted) and (2) as otherwise required under applicable Law.

c. Except as expressly provided in this Section 5.5, no other right to use the Retained Names and Marks isgranted hereunder by the Seller to the Purchaser or any of its Affiliates whether by implication or otherwise, and nothing hereunderpermits the Purchaser or any of its Affiliates to use the Retained Names and Marks in any manner other than in connection withExisting Stock. The Purchaser shall use commercially reasonable efforts to ensure that all uses of the Retained Names and Marksprovided in this Section 5.5 shall be only with respect to goods and services of a level of quality substantially similar to the qualityof goods and services with respect to which the Retained Names and Marks were used in the Business prior to the Closing. Any andall Goodwill generated by the use of the Retained Names and Marks under this Section 5.5 shall inure solely to the benefit of theSeller. In no event shall the Purchaser or any of its Affiliates use the Retained Names and Marks hereunder in any manner that mayreasonably be expected to damage or tarnish the reputation of the Seller or the Goodwill associated with the Retained Names andMarks.

d. The Purchaser agrees that the Seller shall have no responsibility for claims by third parties arising out of, orrelating to, the use by the Purchaser and its Affiliates of any Retained Names and Marks after the Closing Date. In addition to anyand all other available remedies, the Purchaser shall indemnify and hold harmless the Seller Indemnified Parties from and againstany and all such claims that may arise out of the use of the Retained Names and Marks by the Purchaser or any of its Affiliates inaccordance with the terms and conditions of

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this Section 5.5, other than such claims (A) that the Retained Names and Marks, consistent with the use of such Retained Names andMarks prior to the Closing, infringe or dilute the Intellectual Property rights of any third party, (B) that constitute ExcludedLiabilities, or (C) for which the Seller is obligated to indemnify a Purchaser Indemnified Party under Section 8.2; or in violation ofor outside the scope permitted by this Section 5.5. Notwithstanding anything in this Agreement to the contrary, the Purchaser herebyacknowledges that in the event of any breach or threatened breach of this Section 5.5, the Seller, in addition to any other remediesavailable to it, shall be entitled to seek a preliminary injunction, temporary restraining order or other equivalent relief restraining thePurchaser or any of its Affiliates from any such breach or threatened breach, but may not seek to terminate the Purchaser’s right touse the Retained Names and Marks in accordance with the terms of this Section 5.5.

Section 5.6 IP Matters.

a. To the extent there exists any Intellectual Property owned by the Seller or its Affiliates after the Closing (otherthan the Retained Names and Marks) that was used but not primarily used in the operation of the Business as of the Closing, theSeller, on behalf of itself and its Affiliates, hereby grants to the Purchaser and its Affiliates a perpetual, irrevocable, non-exclusive,worldwide, assignable, sublicensable, royalty-free and fully-paid-up license to use such Intellectual Property in connection with theoperation of the Business (and natural evolutions thereof).

b. Prior to the Closing Date, the Seller shall effect any necessary corrective recordals with all patent, trademark,and copyright offices and domain name registrars and other similar authorities with respect to the Registered Intellectual Propertyincluded in the Transferred Assets that is still recorded in the name of legal predecessors of the Seller or any Person other than theSeller, or where the relevant recordals of the patent, copyright, and trademark offices, and domain name registrars, and other similarauthorities with respect to such Intellectual Property are materially incorrect for any other reason.

c. Within 30 days following the date of this Agreement, the Seller shall provide a schedule identifying anyactions that must be taken within 12 months from the date thereof in connection with the prosecution of all Registered IntellectualProperty included in the Transferred Assets, including any responses to office actions.

d. The parties hereto shall, and shall cause their respective Affiliates to, use commercially reasonable efforts totake, or cause to be taken, all appropriate action to complete the items set forth on Section 5.6(d) of the Seller Disclosure Schedule(the completion of all such items, as reasonably agreed by the parties, the “Pre-Closing IT Integration Completion”).

Section 5.7 Insurance

. From and after the Closing Date, the Transferred Assets and the Business shall cease to be insured by the Seller’s insurance policiesor by any of its self-insured programs in respect of any claims or potential claims arising out of or relating to any events orcircumstances occurring from and after the Closing Date. For the avoidance of doubt, the Seller shall retain all rights to

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control its insurance policies and programs, including the right to exhaust, settle, release, commute, buy back or otherwise resolvedisputes with respect to any of its insurance policies and programs, other than in respect of disputes relating to any Post-SigningInsurance Proceeds. The Purchaser agrees to arrange for its own insurance policies with respect to the Business and the Purchasercovering all periods from and after the Closing Date and agrees not to seek, through any means, to benefit from the Seller’sinsurance policies that may provide coverage for claims relating in any way to the Business or the Transferred Assets from and afterthe Closing; provided, that this Section 5.7 shall not be construed to limit Purchaser’s rights to the Post-Signing Insurance Proceedsor indemnification by the Seller granted under this Agreement.

Section 5.8 Employees.

a. Prior to and effective as of the Closing Date, the Purchaser shall, or shall cause one of its Affiliates to, offeremployment to each Business Employee who is actively employed on such date or is absent from employment due to vacation ortemporary illness not reasonably expected to exceed five days (the “Current Employees”) or (A) is absent from work due to anauthorized leave of absence (including but not limited to a leave of absence due to a short-term or long-term disability) or iscategorized by the Seller as active but absent due to workers’ compensation and (B) has the right to return to employment followingexpiration of such absence under applicable Law, effective as of the expiration of the leave (the “Leave Employees” and, togetherwith the Current Employees, the “Closing Date Employees”). All such offers of employment to (1) Current Employees shall providefor employment with the Purchaser or an Affiliate of the Purchaser to commence effective as of 12:00 A.M., local time, on the dayimmediately following the Closing Date and (2) Leave Employees shall provide for employment with the Purchaser or an Affiliateof the Purchaser to commence at the expiration of such Leave Employees’ authorized leave; provided, however that if such LeaveEmployee does not return to active service prior to the end of a period of six months following the commencement of the applicableleave (the “Return Deadline”), such offer shall become null and void upon the Return Deadline and such Leave Employee shall in noevent become a Transferred Employee (as defined below). All such offers of employment shall be made in accordance with theapplicable provisions of this Section 5.8 and to the extent that any Business Employee receives an offer in accordance with thisSection 5.8 and does not accept such offer and commence employment with the Purchaser or any of its Affiliates, neither thePurchaser nor any of its Affiliates shall have any Liability with respect to such Business Employee (including, but not limited to, anyLiability for severance or any other compensation). Each Closing Date Employee who (a) accepts an offer of employment from thePurchaser or one of its Affiliates, (b) executes any employment or similar agreement to the extent reasonably required by thePurchaser and presented to the Closing Date Employee prior to the Closing Date, (c) provides all of the necessary documentation(including, without limitation, I-9) required by applicable Law for employment, and (d) commences employment with the Purchaseror an Affiliate of the Purchaser shall be referred to herein as a “Transferred Employee”; provided, that a Leave Employee shall betreated as a Transferred Employee upon the expiration of the Leave Employee’s authorized leave to the extent that such expirationand return to active service occurs prior to the applicable Return Deadline. The date a Transferred Employee commences, or is

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deemed to commence, employment with the Purchaser or an Affiliate of the Purchaser shall be referred to herein as the “TransferDate.”

b. The Purchaser shall, or shall cause its Affiliates to, provide each Transferred Employee, for a period of no lessthan 12 months after the Transfer Date until the termination of such Transferred Employee’s employment with the Purchaser and itsAffiliates, with employment in a position that is comparable to such Transferred Employee’s position immediately prior to theTransfer Date (except with respect to the number of employees that report to such position); an annual base salary (or in case of anhourly employee, a base hourly wage rate), overtime pay, commissions, and annual bonus opportunities (excluding any equity-basedcompensation and any opportunities relating to a long-term incentive plan), as applicable, as provided to such Transferred Employeeimmediately prior to the Transfer Date; and employee benefits under plans, programs and arrangements that will provide benefits tosuch Transferred Employee that are substantially comparable, in the aggregate (taking into account any other consideration providedto such Transferred Employee relating to employee benefits immediately prior to the foregoing date), to the benefits provided by theSeller and its Subsidiaries (disregarding benefits under any defined benefit pension, retiree welfare, non-qualified deferredcompensation, retention bonus or equity-based compensation plans, policies or programs), in each case, as of immediately prior tothe Transfer Date. Notwithstanding the foregoing, nothing contemplated by this Agreement shall be construed as requiring either thePurchaser or any of its Affiliates to continue the employment of any Transferred Employee for any period on or after the ClosingDate.

c. The Purchase Price shall be reduced at the Closing by an amount equal to all amounts earned and payablebased on actual performance results under the applicable annual cash based bonus plans or policies in which such TransferredEmployees participated for the 2020 performance period, to the extent not paid prior to the Closing by the Seller or one of itsSubsidiaries or Affiliates (the “Accrued 2020 Performance Bonuses”), and all amounts earned and payable at “target” levels ofperformance under the applicable annual cash-based bonus plans or policies in which such Transferred Employee participated for the2021 performance period as of immediately prior to the applicable Transfer Date, with such amounts to be prorated for days ofservice provided by the Transferred Employee during the portion of the 2021 performance period that occurs from the beginning ofsuch performance period through the Transfer Date (the “Accrued 2021 Performance Bonuses” and together with the Accrued 2020Performance Bonuses, the “Accrued Performance Bonuses”), plus the employer portion of any payroll, social security, disability,workers compensation, unemployment or similar Taxes payable by the Purchaser resulting therefrom. The Purchaser agrees to paythe Accrued 2020 Performance Bonuses on behalf of the Seller to each applicable Transferred Employee on the next payroll dateafter such Transferred Employee’s Transfer Date. The Purchaser agrees to pay the Accrued 2021 Performance Bonuses on behalf ofthe Seller to each applicable Transferred Employee on or before the date that the Purchaser pays performance bonuses to itsemployees for 2021. From and after the Transfer Date, each Transferred Employee who participated in an annual cash-based bonusplan sponsored by the Seller or any of its Affiliates as of such date shall be eligible to receive an annual cash-based bonus for theremaining 2021 performance period based on all amounts earned and payable at actual performance determined based on the goals

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applicable under the Seller’s annual cash-based bonus plans or policies in which such Transferred Employee participates for the2021 performance period, and the Purchaser shall be liable for the payment of the amounts, if any (such amounts, the “2021 BonusStub Period Performance Bonuses”), earned thereunder based on actual performance and subject to such Transferred Employee’scontinued service with the Purchaser through the applicable payment date in accordance with the terms of the applicable bonus planor policy, with such 2021 Bonus Stub Period Performance Bonus, if any, to be prorated to reflect only the days of service providedby such Transferred Employee to the Purchaser or any of its Subsidiaries or Affiliates during the portion of the 2021 performanceperiod that occurs after the Transfer Date (such portion, the “2021 Bonus Stub Period”). Notwithstanding the foregoing, in the eventthat a Transferred Employee whose employment with the Purchaser or any of its Subsidiaries or Affiliates is terminated therebyduring the 2021 performance period without “cause,” such Transferred Employee shall be eligible to receive payment of his or her(A) 2021 Bonus Stub Period Performance Bonus earned based on actual performance under the applicable cash-based bonus plan orpolicy of the Purchaser, if any, for 2021 prorated to reflect his or her days of service to the Purchaser and/or any of its Affiliatesduring the 2021 Bonus Stub Period and (B) the Accrued 2021 Performance Bonus.

d. With respect to each Transferred Employee who is terminated without “cause” during the one-year periodimmediately following the Closing Date, the Purchaser or its Affiliates shall provide severance payments to such TransferredEmployee that are no less favorable than those severance payments applicable to such Transferred Employee as of immediately priorto the Transfer Date after taking into account any service that such Transferred Employee has with the Purchaser or its Affiliates asof the date of such termination of employment, including, for the avoidance of doubt, service credited under Section 5.8(e).

e. With respect to each Transferred Employee, effective from and after the Transfer Date, if and to the extent thatthe Seller provides the Purchaser with such information as needed to implement the following (unless prohibited by applicable Law),the Purchaser shall, or shall cause its Affiliates to, use commercially reasonable efforts to recognize, for purposes of eligibility andbenefit levels under Purchaser Benefit Plans that provide for vacation or severance benefits, service with the Seller and itsSubsidiaries or Affiliates prior to the Transfer Date to the extent that such service was recognized under the corresponding SellerBenefit Plan (if any) covering such Transferred Employees, except as would result in the duplication of benefits, recognize, for thepurposes of vesting and eligibility under any Purchaser Benefit Plan that is a tax-qualified defined contribution plan, service with theSeller and its Subsidiaries or Affiliates prior to the Transfer Date to the extent that such service was recognized under thecorresponding Seller Benefit Plan that is a tax-qualified defined contribution plan covering such Transferred Employees, except aswould result in the duplication of benefits, and with respect to Purchaser Benefit Plans that are health and welfare plans, (A) waiveany pre-existing condition exclusion, actively-at-work requirement or waiting period under all employee health and other welfarebenefit plans established or maintained by the Purchaser or its Affiliates in which such Transferred Employee participates, except tothe extent such pre-existing condition, exclusion, requirement or waiting period would have applied to such individual under thecorresponding Seller Benefit Plan (if any), (B) provide credit for co-payments, deductibles or similar payments

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made or incurred by the Transferred Employees prior to the Transfer Date under the corresponding Seller Benefit Plan (if any),covering such Transferred Employees with respect to all employee health and other welfare benefit plans established or operated bythe Purchaser or its Affiliates in which such Transferred Employees participate (other than flexible spending accounts) for the planyear in which the Transfer Date occurs, and (C) be liable for any continued health coverage that such Transferred Employees will beeligible to receive on and after the Transfer Date, if any, under Section 4980B of the Code, Sections 601 through 607 of ERISA orother applicable Law (but excluding any such continuation coverage to which the Transferred Employees are eligible as the result ofthe termination of the Transferred Employee’s employment with the Seller and its Subsidiaries).

f. With respect to each Transferred Employee, immediately prior to such Transferred Employee’s Transfer Date,the Transferred Employee shall cease to contribute to the Seller’s flexible spending account plan (the “Seller FSA Plan”).Transferred Employees who elected to participate in the Seller FSA Plan for the plan year beginning January 1 of the year duringwhich the Closing occurs shall become participants in a flexible spending account plan of the Purchaser or its Affiliate (the“Purchaser FSA Plan”) as if their participation in the Purchaser FSA Plan had been continuous from such January 1 and at the samelevel of coverage elected under the Seller FSA Plan. Following the Transfer Date, each Transferred Employee will be reimbursed bythe Purchaser or its Affiliate under the Purchaser FSA Plan for qualifying medical and dependent care expenses incurred by suchTransferred Employee at any time during the year during which the Closing occurs, up to the amount of the elections made by eachTransferred Employee under the Seller FSA Plan for such year, reduced by amounts previously reimbursed by the Seller or itsAffiliate pursuant to the Seller FSA Plan for such year. To effectuate the foregoing, as soon as practicable after each Transfer Date(and in any event within 30 days following the Closing), the Seller shall provide the Purchaser with a summary of account balancesand confirm whether the amounts of the account balances (if any) under the Seller FSA Plan for the Transferred Employees arepositive or negative in the aggregate immediately prior to such Transfer Date, and the Seller shall pay to the Purchaser suchaggregate balance (if positive) or the Purchaser shall pay to the Seller such aggregate balance (if negative) with respect to allTransferred Employees who become covered under the Purchaser FSA Plan for the plan year during which the Closing occurs.

g. If any Transferred Employee requires a visa, work permit or employment pass or other legal or regulatoryapproval for his or her employment with the Purchaser or its Affiliates, the Purchaser shall, and shall cause its Affiliates to, usecommercially reasonable efforts to cause any such visa, permit, pass or other approval to be obtained and in effect prior to theTransfer Date, and the Seller shall, and shall cause its Subsidiaries or Affiliates to, take all reasonably necessary or appropriateaction, as reasonably requested by the Purchaser, to assist in obtaining any such visa, permits, pass or other approval prior to theTransfer Date.

h. Each of the Purchaser and its Affiliates shall comply in all material respects with applicable Laws regardingconfidentiality of Employee Records transferred to it hereunder.

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i. The Purchaser shall, or shall cause its relevant Affiliate to, grant each Transferred Employee vacation time inan amount equal to such Transferred Employee’s accrued and unused vacation hours. If such Transferred Employee terminatesemployment with the Purchaser or an Affiliate of the Purchaser prior to using such vacation time, the Purchaser or its relevantAffiliate shall pay such Transferred Employee an amount equal to compensation for any such remaining vacation time (with suchvacation time granted pursuant to this Section 5.8(i) deemed to be used first before any further vacation time accrued after theTransfer Date) upon such employment termination equal to the amount of such unused remaining vacation time that suchTransferred Employee would have received if the Seller’s vacation policy as of the Transfer Date were in effect at the time of suchemployment termination.

j. As soon as administratively practicable following the Closing Date, the Purchaser shall permit eachTransferred Employee who was eligible to participate in a defined contribution plan sponsored by the Seller or one of itsSubsidiaries or Affiliates that is intended to be “qualified” within the meaning of Section 401(a) of the Code (the “Seller 401(k)Plan”) to elect to rollover to a defined contribution plan sponsored by the Purchaser or one of its Affiliates that is intended to be“qualified” within the meaning of Section 401(a) of the Code (the “Purchaser 401(k) Plan”), each such Transferred Employee’saccount balance when distributed from the Seller 401(k) Plan, including, to the extent administratively practicable, any outstandingparticipant loans from the Seller 401(k) Plan.

k. The Purchaser expressly agrees that it assumes all obligations to provide any required notice under the WARNAct, or other applicable Laws, and to pay all severance payments, damages for wrongful dismissal and related costs, with respect tothe termination of any Transferred Employee employed by the Purchaser or its Affiliates that occurs on or after the Closing Date.

l. Nothing in this Section 5.8, express or implied, shall confer upon any Business Employee, or legalrepresentative or beneficiary thereof, any rights or remedies, including any right to employment or continued employment for anyspecified period, or compensation or benefits of any nature or kind whatsoever under this Agreement, be construed to prevent thePurchaser or any of its Affiliates from terminating or modifying to any extent or in any respect any Purchaser Benefit Plan, amend,or be deemed to amend, any benefit plan or constitute the establishment of, or an amendment to, any benefit plan.

m. After the Closing Date, the Seller and its Subsidiaries and Affiliates, on the one hand, and Purchaser and itsAffiliates, on the other hand, shall cooperate in good faith with each other to provide such information regarding the BusinessEmployees on an ongoing basis as may be reasonably necessary to facilitate and implement the intent of this Section 5.8, includingdeterminations of eligibility for, and payments of benefits to, such employees and their spouses, dependents and beneficiaries, asapplicable. The Purchaser and its Affiliates shall not disseminate any communications about employment to the Business Employeesprior to the Closing Date without the prior approval of the Seller, and the Seller shall not disseminate any such communicationsabout employment offers without the prior approval of the Purchaser, which approval in each case shall not be unreasonablywithheld, conditioned, or delayed.

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Notwithstanding the foregoing, nothing contained in this Agreement shall prevent either party from making any and all publicdisclosures legally required to comply with any applicable Laws; provided, that, each party shall provide the other party withadvance notice as to the form and content of any such disclosures.

n. All amounts payable under the Retention Agreements to the Retention Agreement Recipients (plus theemployer portion of any payroll, social security, disability, workers compensation, unemployment or similar Taxes payable by thePurchaser resulting therefrom) shall be deducted from the Purchase Price. The Purchaser or one of its Subsidiaries or Affiliates shallassume the Liability with respect to amounts payable to any Retention Agreement Recipients pursuant to the terms of the RetentionAgreements. The Purchaser agrees to pay all such amounts payable under the Retention Agreements to each Retention AgreementRecipient at such time as provided in, and in accordance with the terms and conditions of, the applicable Retention Agreement. Inthe event that the amounts payable under a Retention Agreement are canceled and forfeited pursuant to the terms of such RetentionAgreement (e.g., because the Retention Agreement Recipient voluntarily resigned his or her employment or was terminated forCause before the applicable vesting date as set forth therein), then the Purchaser shall notify the Seller and promptly pay to the Sellerany such amounts canceled, forfeited and no longer payable by the Purchaser to such Retention Agreement Recipient.

o. In consideration of the Purchaser’s agreement to pay or cause to be paid (i) the Accrued Performance Bonusesand the 2021 Bonus Stub Period Performance Bonuses as set forth in Section 5.8(c), and (ii) the amounts payable to the RetentionBonus Recipients under the Retention Agreements as set forth in Section 5.8(n), the Seller hereby agrees to provide the Purchaserwith all information requested by the Purchaser for the purposes of implementing and administering these payments and theRetention Agreements, and, for a period of 12 months following the Closing, to make its (and its Affiliates’) employees available tothe Purchaser and its Subsidiaries and Affiliates to answer questions and provide such additional data and support as requested bythe Purchaser or its Subsidiaries or Affiliates. If, during the 12-month period following the Closing, any representative of thePurchaser contacts the Seller to request assistance or additional information required to implement and administer these payments,and the Seller does not promptly undertake commercially reasonable efforts to provide such data within 45 days following suchrequest, the Purchaser shall no longer be obligated to pay the Accrued Performance Bonuses, the 2021 Bonus Stub PeriodPerformance Bonuses, or the amounts payable under the Retention Agreements, and shall (i) promptly refund to the Seller anyunpaid amounts in respect of the Accrued Performance Bonuses or the amounts payable under the Retention Agreements for theSeller to pay or cause to be paid, as appropriate, and (ii) be permitted to determine 2021 Bonus Stub Period Performance Bonuses forthe Transferred Employees based upon the metrics with respect to which annual bonuses are determined under the annual cash-basedbonus plans or policies of the Purchaser in which similarly situated employees of the Purchaser or its Affiliates are eligible toparticipate.

Section 5.9 Privileged Matters

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. The parties hereto hereby acknowledge that Troutman Pepper Hamilton Sanders LLP has acted as counsel to the Seller inconnection with the transactions contemplated herein. The following provisions apply to the attorney-client relationship between theSeller and Troutman Pepper Hamilton Sanders LLP prior to Closing and the Seller and Troutman Pepper Hamilton Sanders LLPfollowing Closing. The Purchaser agrees that it will not seek to disqualify Troutman Pepper Hamilton Sanders LLP from acting andcontinuing to act as counsel to the Seller either in the event of a dispute hereunder or in the course of the defense or prosecution ofany claim relating to the transactions contemplated herein because of their representation of the Seller in connection with thetransactions contemplated herein; and the Seller has a reasonable expectation of privacy with respect to the Seller’s communications(including any e-mail communications using the Seller’s e-mail system) with Troutman Pepper Hamilton Sanders LLP to the extentsuch communications concern the transactions contemplated by this Agreement or the other Transaction Documents. The partiesfurthermore agree that for the purposes of the attorney-client privilege, any communications between Troutman Pepper HamiltonSanders LLP and the Seller that were made in the course of negotiating the transactions contemplated by this Agreement or the otherTransaction Documents that relate to the subject matter of this Agreement or that may be relevant to any claims for indemnificationunder this Agreement or any other dispute arising in connection with the transactions contemplated hereby (“ProtectedCommunications”) shall be deemed privileged communications of the Seller for the purposes of such claims or disputes, and to theextent that they may not be considered as such at law, the parties hereto agree to contractually treat such Protected Communicationsas if they were privileged communications of the Seller; provided, that, in the event of a dispute after the Closing between thePurchaser, on the one hand, and a Person other than the Seller, on the other hand, the Purchaser may assert the attorney-clientprivilege to prevent disclosure of Protected Communications by Troutman Pepper Hamilton Sanders LLP to such Person.

Section 5.10 Further Action; Third Party Consents.

a. Except as otherwise provided in this Agreement, the parties hereto shall, and shall cause their respectiveAffiliates to, use commercially reasonable efforts to take, or cause to be taken, all appropriate action, to do, or cause to be done, andto assist and cooperate with the other party hereto in doing, all things necessary, proper or advisable under applicable Law (otherthan with respect to the matters covered in Section 5.4) to negotiate, execute and deliver the Transaction Documents and such otherdocuments and other papers as may be required to carry out the provisions of this Agreement and to consummate and make effectivethe transactions contemplated by this Agreement or the other Transaction Documents.

b. From time to time after the Closing, without additional consideration, each party hereto shall, and shall causeits Affiliates to, execute and deliver such further instruments and take such other action as may be necessary or is reasonablyrequested by the other party hereto to make effective the transactions contemplated by this Agreement or the other TransactionDocuments. Without limiting the foregoing, upon reasonable request of a party hereto, the other party shall, and shall cause itsAffiliates to, execute, acknowledge and deliver all such further assurances, deeds, assignments, consequences, powers of attorneyand other instruments and papers as may be required for the transfer to the Purchaser ownership of the

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Transferred Assets, subject to Permitted Encumbrances, and the assumption by the Purchaser of the Assumed Liabilities, ascontemplated by this Agreement or the other Transaction Documents.

c. Prior to the Closing, the Seller shall, and shall cause its Subsidiaries to, use commercially reasonable efforts toobtain all third party consents, waivers or approvals set forth on Section 7.2(g) of the Seller Disclosure Schedule, including payingany fees and expenses associated with obtaining such third party consents, waivers or approvals.

d. Prior to the Closing, the Seller shall, and shall cause its Subsidiaries to, promptly duly execute and deliver tothe Purchaser such authorizations to share information as the Purchaser may reasonably request, in each case, in substantially theform set forth on Section 5.10(d) of the Seller Disclosure Schedule.

Section 5.11 Misdirected Payments.

a. If the Seller or any of its Affiliates, on the one hand, or the Purchaser or any of its Subsidiaries, on the otherhand, after the Closing Date receives any funds properly belonging to the other party or its Affiliates or Subsidiaries, as applicable,including under any Shared Contract, the receiving party will promptly so advise such other party and will promptly deliver suchfunds to an account or accounts designated in writing by such other party.

b. The Seller will promptly deliver to the Purchaser any mail (including e-mail) or other communication receivedby the Seller from and after the Closing Date pertaining to the Business, the Transferred Assets or the Assumed Liabilities. ThePurchaser will promptly deliver to the Seller any mail (including e-mail) or other communication received by the Purchaser from andafter the Closing Date pertaining to the Excluded Assets or the Excluded Liabilities.

c. Following the Closing, in the event that the Seller, the Purchaser or any of their respective Affiliates discoversan asset that would constitute a Transferred Asset if held by the Seller immediately prior to the Closing is owned by the Seller andwas not acquired by the Purchaser hereunder, the Seller shall assign, transfer and convey such asset to the Purchaser for noadditional consideration, and shall execute and deliver such further documents and instruments necessary to give effect to andevidence such assignment, transfer and conveyance and in the event that the Seller, the Purchaser or any of their respectiveAffiliates discovers an asset that did not constitute a Transferred Asset immediately prior to the Closing was acquired by thePurchaser or its Affiliates hereunder, the Purchaser or its Affiliates shall assign, transfer and convey such asset to the Seller for noadditional consideration, and shall execute and deliver such further documents and instruments necessary to give effect to andevidence such assignment, transfer and conveyance. For income Tax purposes, the Purchaser and the Seller shall treat any transferunder this Section 5.11(c) as having occurred at the Closing, except to the extent otherwise required by applicable Law.

d. Notwithstanding anything to the contrary contained in this Agreement, in the event that any Material Contractwas not set forth on Section 3.13(a) of the Seller Disclosure Schedule as of the date hereof, the Purchaser shall have ten BusinessDays from the date the

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Purchaser receives a complete copy of such Contract to review such Contract and determine, in its sole discretion, whether to rejectsuch Contract. If the Purchaser determines to reject such Contract, the Seller shall retain all rights, benefits and obligations pursuantto such Contract, the Purchaser shall have no liability with respect to such Contract and such Contract shall be deemed to be anExcluded Asset for all purposes hereunder.

Section 5.12 Title Insurance.

a. No later than 15 Business Days after the date of this Agreement, the Seller shall deliver to Purchaser for theOwned Real Property (i) one or more title commitments (each, a “Title Commitment”) issued by the Title Insurer, naming thePurchaser (or its designee) as the proposed insured, wherein the Title Insurer shall agree to issue an ALTA form of owner’s TitlePolicy (ii) one or more ALTA/NSPS surveys (each, a “Survey”) certified to the Purchaser (or its designee) and the Title Insurer. Ifthe Purchaser seeks to have any Permitted Encumbrance removed of record (or omitted from the Title Commitment), the Seller shalluse commercially reasonable efforts (but excluding making any payments or incurring any costs, liability or other obligations) tocooperate with the Purchaser in curing (or having the Title Insurer insure over) any Permitted Encumbrance which appears on theTitle Commitment.

b. On the Closing Date, the Title Insurer shall file or record, or cause to be filed or recorded, the applicable LocalConveyance Documents (and all other necessary documents) in order that the legal and equitable title to the Owned Real Propertyshall be duly vested in the Purchaser (or its designee) free and clear of all Encumbrances other than Permitted Encumbrances. TheTitle Insurance costs shall be paid by the Purchaser, Survey costs shall be paid by the Seller, and all escrow closing costs shall beborne equally by the Seller and the Purchaser.

Section 5.13 Financing

.

a. The Purchaser shall use, and shall cause its Affiliates to use, its commercially reasonable efforts to take, orcause to be taken, all actions and to do, or cause to be done all things necessary, proper or advisable to arrange and consummate theDebt Financing (or any Alternative Financing) on the terms and conditions described in the Debt Financing Agreements and to causethe conditions precedent described in the Debt Commitment Letter to be satisfied in a timely basis, including using its commerciallyreasonable efforts to (i) maintain in effect the Debt Financing Agreements (including by complying with so-called “flex” provisions)until the funding of the Debt Financing at or prior to Closing, (ii) satisfy on a timely basis (or obtain a waiver of) all conditions andcovenants applicable to the Purchaser to obtaining the Debt Financing at Closing as set forth therein, (iii) negotiate, execute anddeliver definitive agreements with respect to such Debt Financing on the terms and conditions (including the “flex” provisions)contemplated by the Debt Financing Agreements (and provide copies thereof to the Seller), (iv) fully pay any and all commitmentfees or other fees required by the Debt Financing Agreements and (v) upon satisfaction of the conditions set forth in the DebtCommitment Letter, consummate the Debt Financing at or prior to Closing. In the event that the

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Purchaser becomes aware of any event or circumstance that makes procurement of all or any portion of the Debt Financing unlikelyto occur in the manner or from the sources contemplated in, or pursuant to the terms and conditions of, the Debt Commitment Letterand such Debt Financing or portion thereof is reasonably required for the Purchaser to consummate the transactions contemplated bythis Agreement, the Purchaser shall reasonably promptly notify the Seller, and the Purchaser shall use its commercially reasonableefforts to obtain, as promptly as practicable following the occurrence of such event or circumstance, replacement financings in theform of commitments (other than amounts that are replaced by other funds available to the Purchaser) from alternate sources (the“Alternative Financing”) on terms and conditions that will enable the Purchaser to consummate the transactions contemplated by thisAgreement and that are not materially less favorable in the aggregate to the Purchaser than those contained in the Debt CommitmentLetter; provided, however, that such Alternative Financing shall not (i) be subject to any additional or modified conditions or othercontingencies to the funding of the Debt Financing than those contained in the Debt Commitment Letter or (ii) otherwise bereasonably likely to impair or materially delay the Closing or the date on which the Debt Financing would be obtained. ThePurchaser shall deliver to the Seller complete and correct copies of all material amendments, supplements, other modifications to theDebt Commitment Letter and all agreements pursuant to which any Alternative Financing shall be made available to the Purchaser.For purposes of this Agreement, the term “Debt Financing” shall also be deemed to include any alternate Alternative Financingobtained by the Purchaser and the term “Debt Commitment Letter” shall also be deemed to include any commitment letter (orsimilar agreement) with respect to such Alternative Financing.

b. Prior to the Closing, the Seller shall use commercially reasonable efforts to provide, and shall cause itsSubsidiaries and its and their respective officers, directors and employees, and shall instruct its accountants, consultants, investmentbankers, legal counsel, agents and other advisors and representatives to use their respective commercially reasonable efforts toprovide, in connection with the arrangement of the Debt Financing, all reasonable cooperation (including with respect to timeliness)requested by the Purchaser that is customary in connection with the arrangement of debt financing for transactions that aresubstantially similar to the transactions contemplated by this Agreement, including using commercially reasonable efforts to (i)provide financial and other pertinent information, including any Required Information regarding the Seller and its Subsidiaries andthe Business as may be reasonably requested in writing by the Purchaser in order to consummate the Debt Financing or as necessaryto satisfy the conditions set forth in the Debt Commitment Letter, (ii) participate in a reasonable number of meetings, due diligenceand drafting sessions, presentations (including, without limitation, marketing (or similar) presentations, and lender or other investorpresentations) and sessions with rating agencies, (iii) assisting in preparing customary documents and materials, includingconfidential information memoranda, lender and investor presentations, rating agency presentations and similar documents andmaterials in connection with the Debt Financing (including the execution and delivery by officers of the Seller of customaryauthorization letters), (iv) reasonably cooperating in satisfying the conditions precedent set forth in the Debt Commitment Letter orany definitive document relating to the Debt Financing (to the extent that such conditions precedent in such definitive documents arematerially consistent with the conditions precedent set forth in the Debt Commitment Letter and the satisfaction of such

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condition requires the cooperation of, and is within the control of, the Seller and/or any of its Subsidiaries) and (v) furnishing thePurchaser and the Financing Sources promptly with all documentation and other information which any Financing Source providingor arranging Debt Financing has determined is required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act and the Beneficial Ownership Regulation, it being understood andagreed that information and documents provided by the Seller may be delivered to agents and lenders and other Financing Sourcesunder the Debt Commitment Letter and their representatives (subject to customary arrangements for confidentiality, including thePurchaser providing prior written notice of disclosure to the Seller); provided, however, that neither the Seller nor any of itsSubsidiaries shall be required to pay any commitment or other fee or incur any other liability or obligation in connection with theDebt Financing or to take any action that would be prohibited by any applicable Law or cause a default of, or breach under, orotherwise violate any Contract. The Purchaser shall promptly, upon request by the Seller, reimburse the Seller for all out-of-pocketcosts and expenses (including attorneys’ fees) incurred by the Seller in connection with the cooperation of the Seller contemplatedby this Section 5.13(b) and shall indemnify and hold harmless the Seller and its directors, officers, employees, representatives andAffiliates (collectively, the “Cooperation Indemnitees”) from and against any and all Losses suffered or incurred by any of them inconnection with the arrangement of the Debt Financing and any information used in connection therewith, except to the extentsuffered or incurred as a result of the willful misconduct or bad faith of the Cooperation Indemnitees.

c. Prior to the Closing without the prior written consent of the Seller, the Purchaser shall not permit any materialamendment or modification to be made to, or any waiver of any provision or remedy of, any Debt Financing Agreement, if suchamendments, modifications or waiver would impose new or additional conditions or otherwise expand, amend, modify or waive anyof the conditions to receipt of the Debt Financing, if such amendment, modification or waiver would reasonably be expected to causea material delay to receipt of the Debt Financing under any Debt Financing Agreement or if such amendment, modification orwaiver would reduce the amount of the Debt Financing below an amount which, when combined with the cash or cash equivalentsotherwise available to the Purchaser, would not provide the Purchaser with sufficient funds to consummate the transactionscontemplated by this Agreement; provided that for the avoidance of doubt, the Purchaser may replace, modify, supplement or amendthe Debt Commitment Letter to add lead arrangers, bookrunners, syndication agents or similar entities which had not executed theDebt Commitment Letters as of the date hereof, and make other amendments, modifications or waivers, as long as such replacement,modification, supplement or amendment does not result in the imposition of new or additional conditions or otherwise expand,amend, modify or waive any of the conditions to the receipt of the Debt Financing in a manner which would reasonably be expectedto cause a material delay to the receipt of the Debt Financing or, if applicable, the Alternative Financing.

d. Notwithstanding any other provision of this Agreement, for all purposes of this Agreement, unless the Sellershall have engaged in willful misconduct or bad faith in connection with its obligations under this Section 5.13, the Seller shall notbe deemed to be in

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breach of any of its obligations under, and it shall be deemed to have complied with all of its obligations contained in this Section5.13.

e. The Purchaser acknowledges and agrees that it shall not be a condition to Closing for the Purchaser to obtainthe Debt Financing or the Alternative Financing.

Section i26EHS and FDA Regulatory Information.

At the Closing, the Seller and its Subsidiaries shall provide the documents and information set forth Section 1.189 of theSeller Disclosure Schedules in whatever format they currently exist (i.e., in paper and/or electronic format) or in a format mutuallyagreed upon by the parties, including in IUCLID, or other relevant formats, and in all languages readily available to the Seller or itsSubsidiaries in each such format.

Article VI.

TAX MATTERSSection 6.1 Straddle Period Taxes

. For all purposes of this Agreement, any Taxes (other than Transfer Taxes) incurred with respect to the Transferred Assets or theBusiness for a Straddle Period shall be allocated between the Pre-Closing Tax Period and Post-Closing Tax Period of such StraddlePeriod as follows: any such Tax that is based upon or related to income or receipts shall be allocated based on an interim closing ofthe books as of the close of business on the Closing Date, and any such Tax not described in clause (a) hereof shall be proratedbased on the relative number of days in such Pre-Closing Tax Period and such Post-Closing Tax Period; provided that exemptions,allowances or deductions that are calculated on an annual basis (or on a monthly basis, where required) shall be allocated betweenthe period ending on and including the Closing Date and the period beginning after the Closing Date (or with respect to federalincome Taxes in proportion to the number of days in each period).

Section 6.2 Tax Cooperation and Exchange of Information

. The Seller and the Purchaser shall provide each other, the Purchaser shall cause each of its Subsidiaries to provide the Seller, andthe Seller shall cause each of its Affiliates to provide the Purchaser, with such cooperation and information as either of themreasonably may request of the other in filing any Tax Return, amended Tax Return or claim for refund, determining a liability forTaxes or a right to a refund of Taxes, or participating in or conducting any audit or other proceeding in respect of Taxes relating tothe Transferred Assets or the Business. Such cooperation and information shall include providing copies of relevant Tax Returns orportions thereof, together with related work papers and documents relating to rulings or other determinations by GovernmentalAuthorities. The Seller and the Purchaser shall make themselves (and their respective employees) reasonably available on a mutuallyconvenient basis to provide explanations of any documents or information provided under this Section 6.2. Notwithstandinganything to the contrary in Section 5.2, each of the Seller and its Affiliates and the Purchaser and its Subsidiaries shall retain all TaxReturns, work papers and all material

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records or other documents in its possession, including any electronic files, relating to Tax matters relevant to the Transferred Assetsor the Business for any taxable period that includes the Closing Date and for all prior taxable periods until the later of the expirationof the statute of limitations of the taxable periods to which such Tax Returns and other documents relate (including any extensions orwaivers to such statute of limitations agreed to in writing with a Governmental Authority), or six years following the filing date forsuch Tax Returns. After such time, before the Seller or any of its Affiliates or the Purchaser or any of its Subsidiaries shall dispose ofany such documentation in its possession, including electronic files, the other party shall be given an opportunity, after 90 days’prior written notice, to remove and retain all or any part of such documents as such other party may select (at such other party’sexpense). Any information obtained under this Section 6.2 shall be kept confidential, except as may be otherwise necessary inconnection with the filing of Tax Returns or claims for refund or in conducting an audit or other proceeding with respect to Taxes.

Section 6.3 Transfer Taxes.

Any Transfer Taxes shall be borne and paid 50% by the Purchaser and 50% by the Seller. The party that is required to do soby applicable Law shall prepare and file any Tax Return required to be filed in connection with any Transfer Tax, and shall notifythe non-filing party of the non-filing party’s share of such Transfer Tax. Within four Business Days of receiving such notice, thenon-filing party shall pay its share of such Transfer Tax to the filing party; provided, however, that the non-filing party shall have noobligation to make such payment more than three Business Days prior to the due date for the filing of such Tax Return. ThePurchaser and the Seller agree to cooperate in the execution and delivery of all instruments and certificates necessary to enable theappropriate party to file any Tax Returns relating to the Transfer Taxes and cooperate and use commercially reasonable efforts tomitigate any Transfer Taxes.

Section 6.4 Bulk Sales.

The Purchaser and the Seller hereby mutually agree to waive compliance with the provisions of any bulk transfer or salesLaws, to the extent applicable to the transactions contemplated hereby.

Section 6.5 Tax Treatment.

The Seller, the Purchaser and the SPV acknowledge and agree that for income Tax purposes, (a) the transfer of theTransferred Assets in exchange for the Purchase Price pursuant to the Sale and Purchase shall be treated as a sale and purchase of52.6% of each of the Transferred Assets (and an assumption of 52.6% of each of the Assumed Liabilities by Purchaser), subject toadjustment to account for any adjustments to Purchase Price hereunder and to account for the Purchaser-Owned IP, in a transactionsubject to Section 1001 of the Code, (b) the Contribution and the Preferred Issuance, together, shall be treated as a contribution of47.4% of each of the Transferred Assets to the SPV (and an assumption of 47.4% of each of the Assumed Liabilities by the SPV),subject to adjustment to account for any adjustments to Purchase Price hereunder and to account for the Purchaser-Owned IP, in anexchange subject to Situation 2 of IRS Revenue Ruling 99-5, 1999-1 C.B. 434 and Section 721 of the Code and (c)

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the transfer of the Purchaser-Owned IP pursuant to the Sale and Purchase shall be treated as a transaction subject to Section 1001 ofthe Code (clauses (a), (b) and (c), collectively, the “Intended Tax Treatment”). The Seller, the Purchaser and the SPV agree to reportconsistently with the Intended Tax Treatment on their Tax Returns, and to not take any position for applicable Tax purposes that isinconsistent therewith.

Section 6.6 Wage Reporting.

The Seller and the Purchaser agree to utilize, or cause their respective Affiliates to utilize, the standard procedure set forth inRevenue Procedure 2004-53 with respect to wage reporting with respect to any Transferred Employee.

Article VII.

CONDITIONS TO CLOSINGSection 7.1 Conditions to Obligations of the Seller

. The obligations of the Seller to consummate the transactions contemplated by this Agreement or the other Transaction Documentsshall be subject to the fulfillment or written waiver, at or prior to the Closing, of each of the following conditions:

a. Representations, Warranties and Covenants. (A) The Purchaser Fundamental Representations shall have beentrue and correct in all respects as of the date of this Agreement and as of the Closing Date as though such representations andwarranties had been made as of the Closing Date, except to the extent such representations and warranties are, by their terms, madeas of a specific date, in which case such representations and warranties shall be so true and correct as of such date; and (B) the otherrepresentations of the Purchaser and the SPV set forth in this Agreement shall have been true and correct in all respects as of the dateof this Agreement and as of the Closing Date as though such representations and warranties had been made as of the Closing Date(in each case, without giving effect to any “material” or similar qualifiers set forth therein), except to the extent such representationsand warranties are, by their terms, made as of a specific date, in which case such representations and warranties shall be so true andcorrect as of such date, except where the failure of any such representation or warranty to be so true and correct would not, andwould not reasonably be expected to, prevent or materially delay the consummation by the Purchaser and the SPV of the transactionscontemplated by this Agreement; the covenants and agreements contained in this Agreement to be complied with by the Purchaserand the SPV on or prior to the Closing shall have been complied with in all material respects; and the Seller shall have received acertificate of the Purchaser and the SPV duly executed by a duly authorized representative thereof dated as of the Closing Datecertifying the matters set forth in clauses (i) and (ii) above;

b. Governmental Approvals. Any waiting period (and any extension thereof) under the HSR Act shall haveexpired or shall have been terminated and any consents, authorizations, orders, approvals, declarations and filings required under theAntitrust Laws of the jurisdictions identified on Section 7.1(b) of the Seller Disclosure Schedule shall have been made and obtained.

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c. No Order. There shall not be in effect any Governmental Order issued by a Governmental Authority ofcompetent jurisdiction that permanently enjoins, prohibits or renders illegal the consummation of the transactions contemplated bythis Agreement or the other Transaction Documents.

d. Closing Deliveries. The Purchaser shall have delivered the items contemplated by Section 2.9.

Section 7.2 Conditions to Obligations of the Purchaser and the SPV

. The obligations of the Purchaser and the SPV to consummate the transactions contemplated by this Agreement or the otherTransaction Documents shall be subject to the fulfillment or written waiver, at or prior to the Closing, of each of the followingconditions:

a. Representations, Warranties and Covenants. The Seller Fundamental Representations shall have been true andcorrect in all respects as of the date of this Agreement and as of the Closing Date as though such representations and warranties hadbeen made as of the Closing Date; and the other representations and warranties of the Seller contained in this Agreement shall havebeen true and correct in all respects as of the date of this Agreement and as of the Closing Date as though such representations andwarranties had been made as of the Closing Date (in each case, without giving effect to any “material”, “Material Adverse Effect” orsimilar qualifiers set forth therein), except for such failures to be so true and correct as would not have, and would not reasonably beexpected to have, individually or in the aggregate, a Material Adverse Effect; the covenants and agreements contained in thisAgreement to be complied with by the Seller on or prior to the Closing shall have been complied with in all material respects; andthe Purchaser and the SPV shall have received a certificate of the Seller duly executed by a duly authorized representative thereofdated as of the Closing Date certifying the matters set forth in clauses (i) and (ii) above and Section 7.2(e) below.

b. Governmental Approvals. Any waiting period (and any extension thereof) under the HSR Act shall haveexpired or shall have been terminated and any consents, authorizations, orders, approvals, declarations and filings required under theAntitrust Laws of the jurisdictions identified on Section 7.1(b) of the Seller Disclosure Schedule shall have been made and obtained.

c. No Order. There shall not be in effect any Governmental Order issued by a Governmental Authority ofcompetent jurisdiction that permanently enjoins, prohibits or renders illegal the consummation of the transactions contemplated bythis Agreement or the other Transaction Documents.

d. Environmental Requirements. The Covered Locations Pollution Liability Policy in the form attached hereto asExhibit G (the “Pollution Policy”) shall have been issued by Beazley ECLIPSE, the Seller shall have assigned such Pollution Policyto the Purchaser such that the Purchaser is the First Named Insured and the Seller is the additional Named Insured, and suchPollution Policy shall be in full force and effect. The Purchaser and the Seller shall share equally the cost of the policy premium forthe Pollution Policy and shall pay, or cause to be paid,

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their respective portions of such cost within thirty (30) days of the date of this Agreement; provided, however, the Purchaser shallbear the cost of any premiums associated with any election by the Purchaser to extend the ten-year term.

e. No Material Adverse Effect. Since the date of this Agreement, there shall have been no event, circumstance,condition, state of facts, change or effect that has had, or would reasonably be expected to have, individually or in the aggregate, aMaterial Adverse Effect.

f. Closing Deliveries. The Seller shall have delivered the items contemplated by Section 2.8.

g. Third-Party Consents. All third-party consents, waivers, approvals, permits or other actions set forth onSection 7.2(g) of the Seller Disclosure Schedule, each in a form reasonably satisfactory to the Purchaser, shall have been obtainedand shall be in full force and effect.

Article VIII.

INDEMNIFICATIONSection 8.1 Survival of Representations, Warranties and Covenants

. The representations and warranties of the parties hereto contained in this Agreement or in any certificates delivered pursuant to thisAgreement shall survive the Closing for a period of 18 months after the Closing, except that the representations and warrantiescontained in Section 3.1, Section 3.2, the first sentence and the last sentence of Section 3.17 and Section 3.18 (the “SellerFundamental Representations”) and Section 4.1, Section 4.2 and Section 4.5 (the “Purchaser Fundamental Representations”) shallsurvive the Closing indefinitely, the representations and warranties contained in Section 3.14 other than Section 3.14(a)(iii)(A) shallsurvive the Closing for a period of 36 months after the Closing and the representations and warranties contained in Section 3.14(a)(iii)(A) shall not survive the Closing; and the representations and warranties contained in Section 3.10 and Section 3.12 shallsurvive the Closing for the applicable statute of limitations plus 60 days; and none of the covenants or agreements contained in thisAgreement to be performed prior to the Closing shall survive the Closing, and those covenants which by their terms contemplateperformance after the Closing shall survive the Closing until the expiration of the term of the undertaking set forth in such covenantsand agreements or until performed; provided, however, that any claim made with reasonable specificity by the party seeking to beindemnified within the time periods set forth in this Section 8.1 shall survive until such claim is finally resolved (including anyappeals).

Section 8.2 Indemnification by the Seller

. The Purchaser and its Affiliates and its and their respective, officers, directors, employees, agents, successors and assigns (each a“Purchaser Indemnified Party”) shall from and after the Closing be indemnified and held harmless by the Seller for, from and againstall losses, damages, Taxes, claims, costs and expenses, Liabilities, interest, awards, judgments, fines and penalties

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(including, in each case, those arising out of the defense of any Action and any settlement or compromise thereof or judgmentrelating thereto and reasonable attorneys’ fees and expenses), including costs and expenses incurred in enforcing the provisions ofthis Article VIII, actually suffered or incurred by them (hereinafter a “Loss”), to the extent arising out of, or resulting from, withoutduplication the breach of any representation or warranty made by the Seller contained in this Agreement; the breach of any covenantor agreement of the Seller contained in this Agreement; the Excluded Assets; the Excluded Liabilities; or the items set forth onSection 8.2(e) of the Seller Disclosure Schedule; provided, however, that for purposes of determining the amount of Losses and forpurposes of determining whether a breach of any representation or warranty has occurred, no effect shall be given to any referencesto “materiality”, “Material Adverse Effect” or words of similar import.

Section 8.3 Indemnification by the Purchaser.

The Seller and its Affiliates and its and their respective officers, directors, employees, agents, successors and assigns (each a“Seller Indemnified Party”) shall from and after the Closing be indemnified and held harmless by the Purchaser for and against anyand all Losses, to the extent arising out of, or resulting from, without duplication the breach of any representation or warranty madeby the Purchaser or the SPV contained in this Agreement; the breach of any covenant or agreement of the Purchaser or the SPVcontained in this Agreement; or the Assumed Liabilities; provided, however, that for purposes of determining the amount of Lossesand for purposes of determining whether a breach of any representation or warranty has occurred, no effect shall be given to anyreferences to “materiality”, “Material Adverse Effect” or words of similar import.

Section 8.4 Limitations on Indemnification.

a. No claim for indemnification under Section 8.2 or Section 8.3 may be asserted nor may any Action becommenced against an Indemnifying Party in respect of such claim unless written notice of such claim or Action is received by suchIndemnifying Party describing in reasonable detail the facts and circumstances with respect to the subject matter of such claim orAction (taking into account the information then available to the Indemnified Party) on or prior to the date on which therepresentation, warranty, covenant or agreement on which such claim or Action is based ceases to survive as set forth in Section 8.1.

b. Notwithstanding anything to the contrary contained in this Agreement, the Seller shall not be liable for anyLosses pursuant to Section 8.2(a) and the Purchaser shall not be liable for any Losses pursuant to Section 8.3(a), in each case, unlessand until the aggregate amount of indemnifiable Losses which may be recovered from such Indemnifying Party exceeds $8,625,000(the “Basket”), whereupon the Indemnified Party shall be entitled to indemnification for the amount of such Losses in excess of suchamount; the Seller shall not be liable for any Losses pursuant to Section 8.2(a) and the Purchaser shall not be liable for any Lossespursuant to Section 8.3(a), in each case, relating to an individual claim resulting in Losses in the amount of $15,000 or less (a “DeMinimis Claim”), regardless of whether or not aggregate Losses have exceeded the Basket; nor shall the amount of any such DeMinimis Claims be taken into account in determining whether the Basket has been reached; the maximum amount of

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indemnifiable Losses which may be recovered from any Indemnifying Party arising out of, or resulting from, the causes set forth inSection 8.2(a) or Section 8.3(a) shall be an amount equal to $57,500,000; provided that the foregoing limitations set forth in clauses(i), (ii) and (iii) shall not apply to claims in respect of the Seller Fundamental Representations, the Purchaser FundamentalRepresentations or fraud and provided, further, that the maximum amount of indemnifiable Losses which may be recovered from theSeller under this Agreement shall be the Aggregate Transaction Value; and the parties hereto acknowledge and agree that noIndemnifying Party shall have any Liability under this Article VIII for any Loss, if a court of competent jurisdiction determines thatsuch Loss is caused solely by (A) any action or inaction of the Indemnified Party or any of its Representatives; (B) any action orinaction of the Indemnifying Party or any of its Representatives at the written request, at the written direction, or with the writtenconsent, of the Indemnified Party or any of its Representatives; or (C) any action, that the Indemnifying Party or any of itsRepresentatives was expressly required to take or not to take pursuant to the terms of this Agreement, any Transaction Document or,that the Indemnifying Party or any of its Representatives was required to take under applicable Law.

c. Notwithstanding anything to the contrary contained in this Agreement, after the Closing, except to the extent(i) arising out of Third-Party Claims or (ii) reasonably foreseeable as a result of a breach or alleged breach of this Agreement or anycertificate delivered pursuant to this Agreement or any other mater giving rise to a claim for indemnification under this Article VIII,none of the parties hereto and none of their respective Affiliates shall have any Liability under any provision of this Agreement orany other Transaction Document for any punitive, incidental, consequential, special or indirect damages, loss of future profits,revenue or income, diminution in value or loss of business reputation or opportunity relating to the breach or alleged breach of thisAgreement or any other Transaction Document.

d. For all purposes of this Article VIII, “Losses” shall be calculated net of any recovery or benefit (includinginsurance and indemnification, but net of all costs and expenses incurred in obtaining such recovery or benefit, including premiumincreases) actually paid to the Indemnified Party or any of its Affiliates in connection with the facts giving rise to the right ofindemnification and, if the Indemnified Party or any of its Affiliates receive such recovery or benefit after receipt of payment fromthe Indemnifying Party, then the lesser of (x) the amount of such recovery or benefit, net of all costs and expenses incurred inobtaining such recovery or benefit, including premium increases, and (y) the amount previously recovered from the IndemnifyingParty shall be paid to the Indemnifying Party. Any Losses shall be determined without duplication of recovery by reason of the stateof facts giving rise to such Losses (A) constituting a breach of more than one representation, warranty, covenant or agreement orotherwise being indemnifiable under multiple provisions of this Article VIII or (B) being taken into account in determining anyadjustment to the Purchase Price under Section 2.10 or Section 2.11.

e. Each party hereto shall, and shall cause its respective Affiliates to, use commercially reasonable efforts tomitigate its Losses upon and after becoming aware of any event that would reasonably be expected to give rise to any Losses, andindemnification shall not

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be available with respect to any Loss to the extent such Loss is determined by a court of competent jurisdiction to be attributable to afailure by a party to use commercially reasonable efforts to take (or cause its Representatives to take) reasonable steps to mitigatesuch Loss; provided, that an Indemnified Party shall not be required to seek recovery from an insurance carrier or other Person withrespect to any matter that is the subject of a claim for indemnification under this Article VIII. No party hereto shall be entitled to anypayment, adjustment or indemnification more than once with respect to the same Loss. Notwithstanding anything to the contrarycontained in this Agreement, to the extent that a Loss was taken into account in determining the Aggregate Transaction Value, noIndemnified Party shall be entitled to any indemnification or any other payment for such Loss.

Section 8.5 Notice of Loss; Third-Party Claims.

a. An Indemnified Party shall promptly give the Indemnifying Party written notice in reasonable detail of anymatter which an Indemnified Party has determined has given, or would reasonably be expected to give, rise to a right ofindemnification under this Agreement, stating the amount of the Loss, if known, and method of computation thereof, and containinga reference to the provisions of this Agreement in respect of which such right of indemnification is claimed or arises.

b. If an Indemnified Party shall receive notice of any Action, audit, demand or assessment against it brought by athird party (each, a “Third-Party Claim”), which would reasonably be expected to give rise to a claim for Loss under this Agreement,the Indemnified Party shall promptly give the Indemnifying Party written notice in reasonable detail of such Third-Party Claim,stating the amount of the Loss, if known, and method of computation thereof, and containing a reference to the provisions of thisAgreement in respect of which such right of indemnification is claimed or arises, together with copies of all notices and documentsserved on or received by the Indemnified Party and its Representatives in respect thereof (subject to applicable Law). A failure bythe Indemnified Party to give notice in a timely manner pursuant to Section 8.5(a) or this Section 8.5(b) shall not limit the obligationof the Indemnifying Party under this Agreement, except to the extent such Indemnifying Party is prejudiced thereby. TheIndemnifying Party shall be entitled to assume and control the defense of such Third-Party Claim at its expense and through counselof its choice (which counsel shall be reasonably acceptable to the Indemnified Party), if it gives notice of its intention to do so to theIndemnified Party within 30 days of the receipt of such notice from the Indemnified Party; provided, that the Indemnifying Partyshall not be entitled to assume and control the defense of any Third-Party Claim if (x) the Indemnified Party has been advised bycounsel that a conflict exists between the Indemnified Party and the Indemnifying Party in connection with the defense of suchThird-Party Claim, (y) such Third-Party Claim seeks an injunction or other equitable relief, or arises in connection with any criminalproceeding, criminal investigation or indictment, or (z) the Purchaser reasonably believes that the assumption and defense of suchThird-Party Claim by the Seller could adversely affect the Business or its relationships with customers, clients, suppliers or otherthird parties with whom the Business or any of its Affiliates has a material business relationship. If the Indemnifying Party elects toundertake any such defense against a Third-Party Claim, the Indemnifying Party shall conduct the defense of such Third-Party Claimdiligently and in good

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faith and shall give the Indemnified Party a reasonable opportunity to participate in such defense at its own expense. TheIndemnified Party shall cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party, at theIndemnifying Party’s expense, all witnesses, pertinent records, materials and information in the Indemnified Party’s possession orunder the Indemnified Party’s control relating thereto (or in the possession or control of any of its Representatives) as is reasonablyrequested by the Indemnifying Party or its counsel, subject to applicable Law. The Indemnified Party shall not admit any liabilitywith respect to, or settle, compromise or discharge any Third-Party Claim without the Indemnifying Party’s prior written consent(which consent shall not be unreasonably withheld, conditioned or delayed). If the Indemnifying Party elects to undertake thedefense of a Third-Party Claim, the Indemnifying Party shall have the right to settle any Third-Party Claim (i) (A) for which itobtains a full release of the Indemnified Party from all Liabilities, Losses and obligations in respect of such Third-Party Claim, and(B) the settlement of which does not involve any relief other than money damages which will be paid in full by the IndemnifyingParty, and which does not involve a finding or admission of any violation of Law or other wrongdoing by the Indemnified Party, or(ii) the settlement of which the Indemnified Party consents to in writing.

Section 8.6 Remedies

. Notwithstanding anything to the contrary in this Agreement, each of the parties hereto acknowledges and agrees that following theClosing except with respect to claims for fraud, and other than as provided in Section 10.4(a) or Section 11.12, the indemnificationprovisions of Article VI and this Article VIII shall be the sole and exclusive remedies of the parties hereto and the parties to the otherTransaction Documents, as applicable, for any breach of the representations and warranties contained in this Agreement, in anycertificate delivered pursuant to this Agreement or in any other Transaction Document and for the breach of or any failure to performand comply with any covenant or agreement in this Agreement or in any other Transaction Document; none of the parties hereto,their respective Representatives or any other Person may bring a claim under any other Transaction Document; and any and allclaims arising out of, or in connection with, the Transferred Assets, the Assumed Liabilities, the Business or the transactionscontemplated in this Agreement must be brought under and in accordance with the terms of this Agreement; and notwithstandinganything herein to the contrary, no breach of any representation, warranty, covenant or agreement contained herein or in any otherTransaction Document shall give rise to any right on the part of any party hereto or thereto, after the consummation of thetransactions contemplated by this Agreement or the other Transaction Documents, to rescind this Agreement, any other TransactionDocument or any of the transactions contemplated hereby or thereby. Subject to Section 11.12 and the indemnification provisions setforth in this Article VIII, and except for any claims for fraud, from and after the Closing Date, (A) the Purchaser acknowledges andagrees that the Purchaser Indemnified Parties may not avoid the limitations on liability and available remedies provided in thisAgreement by seeking damages for breach of contract, tort or pursuant to any other theory of liability, all of which are herebywaived, and (B) the Seller acknowledges and agrees that the Seller Indemnified Parties may not avoid the limitations on liability andavailable remedies provided in this Agreement by seeking damages for breach of contract, tort or pursuant to any other theory ofliability, all of which are hereby waived.

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Section 8.7 Further Environmental Provisions.

a. The Seller and the Purchaser agree that during the 45-day period commencing on the Closing Date, thePurchaser shall perform and complete a Phase II ESA at the Owned Real Property in South Haven, Michigan as reasonablynecessary to obtain liability protection under Mich. Comp. Laws §324.20126(1)(c) and in accordance with the scope set forth onExhibit F. All costs of conducting the Phase II ESA, including the costs of any independent third-party environmental consultantengaged to perform the Phase II ESA (the “Consultant”), shall be borne solely by the Purchaser. The Seller may request, and uponsuch request, the Purchaser shall promptly provide the Seller with a copy of all draft Phase II ESA reports prepared by Consultantengaged to perform the Phase II ESA and shall otherwise keep the Seller informed as to the status of the Phase II ESA. Such draftPhase II ESA reports shall be reviewed by both the Purchaser and the Seller and each may provide comments, questions, and inputon the documents prepared by the Consultant within seven days of receiving such documents, which the Consultant shall address inits best professional judgment. The Purchaser shall promptly provide the Seller with copies of the final Phase II ESA report (the“Final Phase II Report”).

b. Any Hazardous Materials whose concentrations, as set forth in the Final Phase II Report, are below theapplicable Trigger Levels shall not constitute Seller Environmental Liabilities. Any Hazardous Materials whose concentrations, asset forth in the Final Phase II Report, are above the applicable Trigger Levels shall cease being Seller Environmental Liabilities uponreceipt by the Seller of a no further action letter from the Michigan Department of Environment, Great Lakes, and Energy regardingsuch Hazardous Materials and satisfaction of all terms and conditions therein.

c. With respect to any Remedial Action that is necessary to satisfy the Seller’s indemnification obligations underSection 8.2 for any Seller Environmental Liabilities:

i. the Seller shall have the right, but not the obligation, to conduct and control the Remedial Action andrelated activities; provided, however, that, if the Seller elects to conduct such Remedial Action, the Seller shall (A) do so in areasonable manner without unreasonably interfering with the Purchaser’s operations or use of the Manufacturing Facilitiesand Owned Real Property, (B) consult with the Purchaser in all material respects in connection with undertaking theRemedial Action, (C) provide the Purchaser with copies of all correspondence submitted to and received from anyGovernmental Authority relating to the Remedial Action or to the associated Release of Hazardous Materials, as well ascopies of all reports and assessments prepared by the Seller on the Remedial Action, (D) provide the Purchaser with areasonable opportunity to provide comments to any material submissions to any Governmental Authority with respectthereto, including to any corrective action plans or proposals, and the Seller shall reasonably consider any such comments inconnection with such submission in good faith, and (E) provide the Purchaser with reasonable notice of all plannedsubstantive meetings and telephone conferences with the applicable Governmental Authority and the Purchaser shall have theright to attend and participate in such meetings and telephone conferences; further, the Seller shall not settle or compromiseany such Remedial Action

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to the extent that it would materially interfere with the Manufacturing Facility or Owned Real Property without the priorwritten consent of the Purchaser, such specific consent not be the unreasonably withheld or delayed;

ii. the Purchaser shall, and shall cause its Affiliates to, cooperate with the Seller, including by providingaccess to the subject site, including access to install, maintain, replace and operate wells and remove impacted soil and/orgroundwater or undertake other activities related to such Remedial Action; provided, however, that the Seller shall exercisesuch rights of access in a reasonable manner without interfering with the Purchaser’s operations or use of the ManufacturingFacilities and Owned Real Property;

iii. pursuant to applicable Environmental Laws including, but not limited to, Mich. Comp. Laws §§324.20101 to 324.20142 and Act 2, the Seller shall only be liable for its share of the costs incurred to the extent suchRemedial Action is conducted in the Most Cost-Effective Manner (as defined below). As used in this Agreement, the “MostCost-Effective Manner” shall mean conduct appropriate for the facility determined from the perspective of a reasonablebusiness person acting (without regard to the availability of indemnification hereunder) to (A) achieve compliance withapplicable Trigger Levels or other applicable Environmental Laws and Environmental Permits or respond to a requirement ororder by a Governmental Authority, or (B) minimize liability to third parties, including to obtain liability protection pursuantto Mich. Comp. Laws §§ 324.20101 to 324.20142 and Act 2, and risk to human health, taking into account any interferencewith the Purchaser’s operations or use of the Manufacturing Facilities and Owned Real Property and incorporating (1) theleast stringent clean-up standards that, based upon the use classification as of the Closing Date (industrial, commercial orresidential) of the subject site, are allowed under applicable Environmental Law and that are approved or otherwiseacceptable to applicable Governmental Authorities; and (2) the least-costly methods that are allowed under applicableEnvironmental Law and that are approved by or otherwise acceptable to applicable Governmental Authorities to achieve suchstandards, including the use of engineering and institutional controls to eliminate or minimize actual or potential exposurepathways. With respect to any Remedial Action that is required to satisfy the Seller’s indemnification obligations underSection 8.2 or this Section 8.7, the Purchaser shall be responsible for performing any operation and maintenance with respectto any such institutional or engineering controls subsequent to completion of their initial installation or recording and forpayment of any associated costs directly related to the administration of the operation and maintenance of such institutionalor engineering controls and such post-installation or recording costs shall not be subject to indemnification;

iv. The Purchaser shall notify the Seller promptly regarding any requirements or orders from anyGovernmental Authority regarding a Remedial Action and, subject to Section 8.7(c)(v), shall not take any action tocommence or accelerate any such Remedial Action without the prior written consent of the Seller; and

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v. If the Seller, after receiving written notice from the Purchaser pursuant to Section 8.7(c)(iv), fails totimely commence, or cause to be timely commenced, or fails to diligently prosecute to completion in a timely manner, anyRemedial Action required by a Governmental Authority or subject to an order of a Governmental Authority, then,notwithstanding Section 8.7(c)(iv), the Purchaser shall have the right, but not the obligation, exercisable by written notice tothe Seller at any time, to undertake such Remedial Action, and the Seller shall be responsible for payment of any reasonableand associated costs.

d. With respect to any action (other than any such action that is a Remedial Action) to correct a violation of anyEnvironmental Law or Environmental Permit that is required to satisfy the Seller’s obligations under this Section 8.7 orindemnification obligations under Section 8.2 for any breach of the representations and warranties in Section 3.14 or any SellerEnvironmental Liabilities and, notwithstanding Section 8.5, including any Third-Party Claim seeking Losses for any pre-Closingviolation of, or noncompliance with, any Environmental Law or Environmental Permit:

i. pursuant to applicable Environmental Laws, the Purchaser shall control and complete the conduct ofsuch corrective action in the Most Cost-Effective Manner; provided, however, that the Purchaser shall consult with the Sellerin all material respects in connection with undertaking the corrective action, shall provide the Seller with copies of allmaterial correspondence submitted to and received from any Governmental Authority relating to the corrective action or tothe associated violation or noncompliance, shall provide copies of all reports and assessments prepared by the Purchaser onthe activity other than a Remedial Action, shall provide the Seller with reasonable opportunity to provide comments to anymaterial submissions to any Governmental Authority with respect thereto, including to any corrective action plans orproposals, and the Purchaser shall reasonably consider any such comments in connection with such submission;

ii. the Purchaser shall, and shall cause its Affiliates to, provide the Seller with reasonable notice of allplanned substantive meetings and telephone conferences with the applicable Governmental Authority, and the Seller and itsRepresentatives shall have the right to attend and participate in such meetings and telephone conferences;

iii. the Seller shall not be obligated to indemnify any Purchaser Indemnified Party for capital costsincurred in connection with the implementation of a corrective action that are (A) not required by a Governmental Authorityor (B) not reasonably necessary to achieve compliance with applicable Environmental Laws and Environmental Permitswhich costs are in excess of the Most Cost-Effective Manner. The parties hereto agree that, with respect to a corrective actionrequired under Section 8.7(d), the Most Cost-Effective Manner shall include, and the Seller shall be obligated to indemnifythe Purchaser Indemnified Parties for, reasonable capital costs incurred in order to allow the Purchaser to operate in a mannerand at a level of production that is

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consistent with the subject facility’s operations conducted during the 12-month period prior to the assertion of the particularclaim;

iv. the Seller shall under no circumstances be responsible for any costs related to compliance with anyEnvironmental Law or Environmental Permit subsequent to the Closing, including any operating costs related to any capitalupgrade or improvements made as, or in connection with any, such corrective action or legal or regulatory changes; provided,that, for the avoidance of doubt, the Seller shall be responsible for all costs related to compliance with any applicableEnvironmental Law or Environmental Permit arising out of acts or omissions of the Seller or the Business prior to theClosing;

v. the Seller shall under no circumstances be responsible for any removal, abatement, encapsulation ormaintenance of any Hazardous Materials included in any building material or equipment, including any Hazardous Materialsdiscovered, encountered or disturbed pursuant to any demolition, renovation or construction subsequent to the Closing; and

vi. for the sake of clarity, the parties acknowledge that, notwithstanding Section 8.5, this Section 8.7 doesnot in any way limit, condition or otherwise affect the Seller’s right to control the defense of any Third-Party Claim orAction, including any Third-Party Claim or Action seeking fines or penalties for any pre-Closing violation of ornoncompliance with any Environmental Law or Environmental Permit. If the Seller is controlling the defense of such Third-Party Claims or Actions, then the Purchaser’s obligations set forth above in Section 8.7(d)(i) and (ii) shall apply to the Seller,and the Seller shall not settle or compromise any such Third-Party Claim or Action to the extent that it would materiallyinterfere with the Business, the Manufacturing Facility or Owned Real Property without the prior written consent of thePurchaser, such specific consent not be the unreasonably withheld or delayed.

e. With respect to the Seller’s obligations under this Section 8.7 or indemnification obligations under Section 8.2for any breach of the representations and warranties in Section 3.14 or any Seller Environmental Liabilities, the Seller shall not beresponsible for Losses to the extent they are caused, triggered, increased or have their timing accelerated by any negligent act by thePurchaser or any of its Representatives subsequent to the Closing, or any changes in Environmental Law coming into effectsubsequent to the Closing.

f. With respect to the Seller’s obligations under this Section 8.7 or indemnification obligations under Section 8.2for any breach of the representations and warranties in Section 3.14 or any Seller Environmental Liabilities, the Seller shall not beresponsible for Losses and any such Losses shall constitute Purchaser Environmental Liabilities and shall not constitute SellerEnvironmental Liabilities, to the extent they are caused, triggered, increased or have their timing accelerated by any change in useclassification of a subject Owned Real Property, subsequent to the Closing from industrial to commercial or residential or fromcommercial to residential due to any action by the Purchaser; any decommissioning, closure or shutdown of a facility or a unit,including a waste management unit; or any intrusive

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environmental sampling, analysis, investigation, assessment, or testing of soil or groundwater at any Owned Real Propertyconducted subsequent to the Closing by or on behalf of the Purchaser or one of its Affiliates unless written notice has been providedto the Seller and such sampling, analyses, investigation, assessment, or testing is (A) required to comply with Environmental Law orrequired by a Governmental Authority, (B) performed in accordance with Section 8.7(a) or (C) performed in connection withSection 8.7(g).

g. Notwithstanding anything to the contrary contained in this Agreement, if a Governmental Authority requiresthe Seller to complete a Remedial Action arising from or relating to the presence or any Releases of Hazardous Materials prior to theClosing Date at, in, on or from the Manufacturing Facility or Owned Real Property located in South Haven, Michigan, and theSeller’s Liability is caused, triggered, increased or had its timing accelerated by the Purchaser’s demolition, renovation, construction,disturbance, grading, excavation, dredging or removal to, into or underneath the ground, including but not limited to soil,groundwater, sediment, dredge materials, buildings pads/slabs, foundations, buildings, structures, piping, sumps, pits, vaults,underground storage tanks, debris and waste (unless, in each case, any such activity was performed as a part of routine maintenancework planned and performed at regular intervals and based on testing or other evidence indicating the maintenance work is necessaryto extend the life or prevent the premature failure of structures or fixtures), then the Purchaser and the Seller shall split the cost ofsuch Losses equally. Notwithstanding Section 8.7(c)(i), the Purchaser shall have the right to control any Remedial Action related tothe foregoing Losses in accordance with and subject to Section 8.7(c).

h. The Purchaser acknowledges that its sole and exclusive remedy against the Seller or any Subsidiary of theSeller, and the Seller acknowledges that its sole and exclusive remedy against the Purchaser or any Subsidiary of the Purchaser, forany Losses or Liabilities relating to any applicable Environmental Laws, Environmental Permits or Hazardous Materials, or anyenvironmental, health or safety matter, including natural resources (“Environmental Losses”), is under Section 8.2 or this Section8.7. In furtherance of the foregoing, from and after the Closing Date, except for any Losses for which the Seller is obligated toindemnify the Purchaser pursuant to Section 8.2 or this Section 8.7, the Purchaser and the Seller each hereby (i) waive, on its behalfand on behalf of its Affiliates, predecessors, successors and assigns, officers, directors, employees, agents and partners, to the fullestextent permitted under applicable Law, any claim or remedy against the Seller Indemnified Parties and the Purchaser IndemnifiedParties, respectively, now or hereafter available under any applicable Environmental Law, including the ComprehensiveEnvironmental Response, Compensation and Liability Act or any other Law, whether or not in existence on the date hereof.

i. Notwithstanding anything to the contrary contained in this Agreement, none of the Seller or any of itsSubsidiaries shall be liable for any claim under this Section 8.7 or for indemnification under Section 8.2 for any SellerEnvironmental Liabilities described in Section 1.151(a) or Seller Environmental Liabilities described in Section 1.151(d)(collectively, “Seller Indemnified Remedial Action or Environmental Noncompliance”) made after the fourth anniversary of theClosing Date; provided, however, that any written claim made with reasonable technical and legal specificity by the Purchaser priorto the fourth anniversary of the Closing

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Date shall survive until such claim is finally and fully resolved. No Losses may be claimed under Section 8.2 for any ExcludedLiability that is a Seller Indemnified Remedial Action or Environmental Noncompliance unless and until the aggregate amount ofindemnifiable Losses relating to Seller Indemnified Remedial Actions or Environmental Noncompliances exceeds $250,000,whereupon Purchaser Indemnified Parties shall be entitled to indemnification for the amount of such Losses in excess of suchamount. The maximum amount of indemnifiable Losses which may be recovered from the Seller arising out of or resulting fromSeller Indemnified Remedial Actions or Environmental Noncompliances shall be an amount equal to $25 million.

j. Notwithstanding anything in this Agreement to the contrary, the Seller shall have no indemnificationobligation or other Liability for any Losses, and such Losses shall not constitute Seller Environmental Liabilities, to the extentarising from or related to the presence or any Releases of Hazardous Materials at, in, on or from the Manufacturing Facility orOwned Real Property located in Tyrone, Pennsylvania prior to the Closing Date; the presence or any Releases of per- orpolyfluoroalkyl compounds identified or described in Michigan Law or dioxane at, in, on or from any the Manufacturing Facility orOwned Real Property located in South Haven, Michigan prior to the Closing Date and any third-party tort or other third-party claimsto the extent arising from or relating to the presence or any Releases of Hazardous Materials at, in, on or from the ManufacturingFacility or Owned Real Property located in South Haven, Michigan prior to the Closing Date as described in Section 1.151(a) of thedefinition of Seller Environmental Liabilities; or any exposure prior to the Closing Date, other than (A) to any current or formeremployee of the Seller, to Hazardous Materials in connection with the Seller’s operation of the Business at any ManufacturingFacility or Owned Real Property or (B) to any Hazardous Material included in any product or material manufactured, marketed, soldor distributed prior to the Closing Date, by the Seller from any Manufacturing Facility or Owned Real Property or by the Business asdescribed in Section 1.151(c) of the definition of Seller Environmental Liabilities; provided, however, (A) to the extent the Purchaseris unable to recover under the Pollution Policy for any Losses described in the foregoing clauses (i) or (iii) due to the Seller’s breachof the Pollution Policy, then the Seller shall indemnify the Purchaser for such Losses to the same extent that such Losses would havebeen covered by the Pollution Policy but for the Seller’s breach; and (B) to the extent the Purchaser breaches the Pollution Policyand the Seller incurs any Losses that otherwise would have been covered by the Pollution Policy but for the Purchaser’s breach, thenthe Purchaser shall indemnify the Seller for such Losses.

k. Except as with respect to matters relating to any COVID Action, which are addressed elsewhere in thisAgreement, any Liabilities arising from noncompliance with Environmental Laws in the operation of the Business that are identifiedwithin six months following the Closing Date shall be presumed to have occurred prior to the Closing Date such that suchnoncompliance constitutes a Seller Environmental Liability, which presumption shall be rebuttable by the Seller based on apreponderance of the evidence.

Section 8.8 Subrogation

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. Upon making any payment for Losses of an Indemnified Party under this Article VIII, the Seller, in the case of the PurchaserIndemnified Parties, and the Purchaser, in the case of the Seller Indemnified Parties, will, to the extent of such payment, besubrogated to all rights (if any) of the Indemnified Party against any insurance policy with respect to the Loss for which the paymentrelates; provided, that, for the avoidance of doubt, in no event shall the Seller be subrogated to any rights that a PurchaserIndemnified Party may have against any customer, client, supplier or other third party with whom the Business, the Seller or any ofits Affiliates has a material business relationship. In addition to any other obligation under this Agreement, the Indemnified Partyagrees to duly execute and deliver, on behalf of the Seller or the Purchaser, as the case may be, all instruments reasonably necessaryto evidence and perfect the subrogation rights granted pursuant to this Section 8.8.

Article IX.

TERMINATIONSection 9.1 Termination

. This Agreement may be terminated at any time prior to the Closing:

a. by either the Seller or the Purchaser if the Closing shall not have occurred within one hundred twenty (120)days following the date of this Agreement (the “Termination Date”); provided, that (i) the right to terminate this Agreement underthis Section 9.1(a) shall not be available to either such party whose breach of any representation or warranty hereunder or action orfailure to fulfill any obligation under this Agreement shall have been the cause of, or shall have resulted in, the failure of the Closingto occur on or prior to such date, and (ii) neither the Seller nor the Purchaser shall have the right to terminate this Agreement underthis Section 9.1(a) if the Pre-Closing IT Integration Completion has not yet occurred as of such time, unless the other party has failedto perform its obligations under Section 5.6(d) of this Agreement and such failure is not cured within five (5) Business Days ofnotice by the non-breaching party;

b. by either the Seller or the Purchaser in the event that any Governmental Authority of competent jurisdictionshall have issued a Governmental Order that permanently enjoins or prohibits or renders illegal the consummation of the transactionscontemplated by this Agreement or the other Transaction Documents and such Governmental Order shall have become final andnon-appealable; provided, however, that the right to terminate this Agreement under this Section 9.1(b) shall not be available to anyparty whose breach of any representation or warranty in this Agreement or failure to fulfill any obligation under this Agreement hasbeen the cause of, or has resulted in, the issuance of such Governmental Order or other action;

c. by the Seller if a breach of any representation, warranty, covenant or agreement on the part of the Purchaserset forth in this Agreement (including an obligation to consummate the Closing) shall have occurred that would, if occurring orcontinuing on the Closing Date, cause the condition set forth in Section 7.1(a) not to be satisfied, and such breach is not cured, or isincapable of being cured, within 30 days (but no later than the Termination Date) of receipt of written notice by the Purchaser fromthe Seller of such breach; provided, that

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the Seller is not then in breach of this Agreement so as to cause any of the conditions set forth in Section 7.2(a) not to be satisfied;

d. by the Purchaser if a breach of any representation, warranty, covenant or agreement on the part of the Sellerset forth in this Agreement (including an obligation to consummate the Closing) shall have occurred that would, if occurring orcontinuing on the Closing Date, cause the condition set forth in Section 7.2(a) not to be satisfied, and such breach is not cured, or isincapable of being cured, within 30 days (but no later than the Termination Date) of receipt of written notice by the Seller from thePurchaser of such breach; provided, that the Purchaser is not then in breach of this Agreement so as to cause any of the conditionsset forth in Section 7.1(a) not to be satisfied; or

e. by the written consent of the Seller and the Purchaser.

Any termination pursuant to this Section 9.1 (other than a termination pursuant to Section 9.1(e) hereof) shall be effected bywritten notice from the party so terminating to the other party, which notice shall specify the Section hereof pursuant to which thisAgreement is being terminated.

Section 9.2 Effect of Termination

. In the event of termination of this Agreement as provided in Section 9.1, this Agreement shall forthwith become void and have noeffect and there shall be no liability on the part of any party hereto or any of their respective Representatives; provided, that Section5.3, this Section 9.2 and Article XI shall survive any termination; and nothing herein shall relieve any party hereto from liability forany fraud occurring prior to such termination.

Article X.

RESTRICTIVE COVENANTSSection 10.1 Non-Competition

. Other than conducting the business of the Seller as it is conducted as of the date hereof and the Closing Date (other than theBusiness), the Seller shall not, and shall cause its Affiliates not to, for a period of three years after the Closing Date anywhere in theEuropean Union, and for a period of five years after the Closing Date anywhere in the world (other than the European Union),directly or indirectly, as an advisor, manager, consultant, broker, owner or equity holder (other than as an equity holder of less thantwo percent of the issued and outstanding shares of a publicly traded company) or otherwise, engage anywhere in, operate, beemployed by, perform services for, endorse, solicit business for, have any financial interest in or otherwise be affiliated with, anybusiness, activity or enterprise that competes in any way with the Business as conducted as of the Closing Date other than as aconsultant of the Purchaser or its Affiliates; provided, that, notwithstanding the foregoing, this Section 10.1 will not restrict theSeller or any Subsidiary thereof from engaging in the activity of researching, developing, manufacturing, producing, having made orproduced, marketing, selling (or providing services related thereto), any Excluded Products.

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Section 10.2 Non-Solicitation of Employees

. The Seller shall not, and shall cause its Affiliates not to, for a period of one year after the Closing Date, for itself or on behalf ofany other individual or entity, directly or indirectly, solicit for employment or employ or retain, including as a consultant orcontractor, any Person who is a then-current employee of the Business, or induce or attempt to induce any such Person to leave hisor her employment or retention with the Purchaser or such Affiliate; provided, however, that notwithstanding the foregoing, thisSection 10.2 shall not restrict the Seller or any Affiliate from employing any such Person whose employment was terminated by thePurchaser or any Affiliates prior to such solicitation by the Seller or its Affiliates or who responds to a general solicitation oradvertisement by the Seller or any of its Affiliates that is not targeted specifically at employees of the Business.

Section 10.3 Non-Solicitation or Interference with Customers and Suppliers

. The Seller shall not, and shall cause its Affiliates not to, for a period of two years after the Closing Date, directly or indirectly, foritself or on behalf of any other individual or entity, solicit, divert, take away or attempt to take away from the Business on and afterthe Closing Date any customers or suppliers of the Business as of the date hereof or as of the Closing Date or the business orpatronage of any such customers or suppliers of the Business as of the date hereof or as of the Closing Date or in any way interferewith, disrupt or attempt to disrupt any relationships existing as of the date hereof or as of the Closing Date between the Business andany of its customers or suppliers or other individuals or entities.

Section 10.4 Acknowledgments; Enforcement.

a. The Seller acknowledges that, in view of the nature of the businesses of the Purchaser and the businessobjectives of the Purchaser in acquiring the Business, and the consideration paid to the Seller hereunder, the restrictions andcovenants contained or referenced in this Article X are reasonable and necessary to protect the legitimate business interests of thePurchaser and that any violation of such restrictions will result in irreparable injury to the Purchaser, its Affiliates and the Businessfor which damages would not be an adequate remedy. The Purchaser acknowledges that, in view of the nature of the businesses ofthe Seller and the business objectives of the Seller in selling the Business, the restrictions and covenants contained or referenced inthis Article X are reasonable and necessary to protect the legitimate business interests of the Seller and that any violation of suchrestrictions will result in irreparable injury to the Seller, its Affiliates and their respective businesses for which damages would notbe an adequate remedy. The Seller and the Purchaser therefore acknowledge that, if any such restrictions or covenants are violated,the other party shall be entitled to preliminary and injunctive relief against the violating party as well to an equitable accounting ofearnings, profits and other benefits arising from such violation without the posting of any bond or deposit with any GovernmentalAuthority.

b. If, at the time of enforcement of any covenant contained in this Article X, a court or other GovernmentalAuthority shall hold that the duration, scope or geographic restrictions stated herein are unreasonable under circumstances thenexisting, the parties hereto

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agree that the maximum duration, scope or geographic area reasonable under such circumstances shall be substituted for the statedduration, scope or geographic area and that the court or other Governmental Authority shall be allowed and directed to revise therestrictions contained herein to cover the maximum period, scope and geographic area permitted by Law.

Article XI.

GENERAL PROVISIONSSection 11.1 Expenses

. Except as otherwise specified in this Agreement, all costs and expenses, including fees and disbursements of counsel, financial andother advisors and accountants, incurred in connection with this Agreement and the transactions contemplated by this Agreement orthe other Transaction Documents shall be borne by the party incurring such costs and expenses, whether or not the Closing shallhave occurred.

Section 11.2 Seller Disclosure Schedule

. Notwithstanding anything to the contrary contained in the Seller Disclosure Schedule, in this Agreement or in the other TransactionDocuments, the information and disclosures contained in any Section of the Seller Disclosure Schedule shall be deemed to bedisclosed and incorporated by reference in each other Section of the Seller Disclosure Schedule as though fully set forth in suchother Section to the extent the relevance of such information to such other Section is reasonably apparent on the face of suchdisclosure notwithstanding the omission of a reference or a cross-reference with respect thereto and notwithstanding any reference toa Section of the Seller Disclosure Schedule in this Agreement. Certain items and matters (other than matters required by a particularrepresentation or warranty to be included in the Seller Disclosure Schedule) are listed in the Seller Disclosure Schedule forinformational purposes only and may not be required to be listed therein by the terms of this Agreement. In no event shall the listingof items or matters in the Seller Disclosure Schedule be deemed or interpreted to broaden, or otherwise expand the scope of, therepresentations and warranties or covenants and agreements contained in this Agreement. No reference to, or disclosure of, any itemor matter in any Section of this Agreement or any Section of the Seller Disclosure Schedule shall be construed as an admission orindication that such item or matter is material or that such item or matter is required to be referred to or disclosed in this Agreementor in the Seller Disclosure Schedule (other than any matters required by a particular representation or warranty to be included in theSeller Disclosure Schedule). Without limiting the foregoing, no reference to, or disclosure of, a possible breach or violation of anycontract or agreement, Law or Governmental Order shall be construed as an admission or indication that a breach or violation existsor has actually occurred.

Section 11.3 Notices

. All notices, requests, claims, demands, disclosures and other communications required or permitted by this Agreement shall be inwriting and shall be deemed to have been given at the earliest of the date when delivered personally, by messenger or by overnightdelivery service by a recognized commercial carrier to an officer of the other party, when received if mailed by

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registered or certified United States mail, postage prepaid, return receipt requested, or when received via electronic mail, in all casesaddressed to the person for whom it is intended at his address set forth below or to such other address as a party shall havedesignated by notice in writing to the other party in the manner provided by this Section 11.3:

if to the Seller:

Albemarle Corporation

Suite 9004250 Congress StreetCharlotte, North Carolina 28209Attention: Karen G. NarwoldEmail: [email protected]

with copies (which shall not constitute notice) to:

Albemarle Corporation

Suite 9004250 Congress StreetCharlotte, North Carolina 28209Attention: Legal Dept.Email: [email protected]

and

Troutman Pepper Hamilton Sanders LLP

1001 Haxall PointRichmond, Virginia 23219Attention: John Owen GwathmeyEmail: [email protected]

if to the Purchaser or the SPV:

W. R. Grace & Co.–Conn.

7500 Grace DriveColumbia, Maryland 21044Attention: President, Materials TechnologiesEmail: [email protected]

with copies (which shall not constitute notice) to:

W. R. Grace & Co.-Conn.

7500 Grace DriveColumbia, Maryland 21044Attention: Legal Services GroupEmail: [email protected]

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and

Fried, Frank, Harris, Shriver & Jacobson LLP

One New York PlazaNew York, New York 10004Attention: Steven EpsteinEmail: [email protected]

Section 11.4 Public Announcements

. The initial press release in respect of the transactions contemplated by this Agreement and the other Transaction Documents shallbe prepared by the Purchaser (and the Purchaser shall give the Seller a reasonable opportunity to review and comment thereon).None of the parties to this Agreement shall make, or cause to be made, and each of the parties to this Agreement shall cause itsAffiliates and Representatives not to make, any press release or public announcement in respect of this Agreement, the otherTransaction Documents or the transactions contemplated hereby and thereby or otherwise communicate with any news mediaregarding this Agreement, the other Transaction Documents or the transactions contemplated hereby and thereby (each, a “PublicAnnouncement”) without the prior written consent of the other party (and shall consult with and give such other party a reasonableopportunity to review and comment thereon), unless such Public Announcement is required by Law or applicable stock exchangeregulation, in which case the parties to this Agreement shall, to the extent practicable, consult with each other as to the timing andcontents of any such Public Announcement; provided, however, that, notwithstanding the foregoing, the Purchaser, its Affiliates andits Representatives and the Seller, its Affiliates and its Representatives shall be entitled to make any Public Announcement withoutsuch consent to the extent such Public Announcement is consistent in all material respects with the initial press release.

Section 11.5 Severability

. If any term or other provision of this Agreement is declared invalid, illegal or incapable of being enforced by any GovernmentalAuthority, all other terms and provisions of this Agreement shall nevertheless remain in full force and effect for so long as theeconomic or legal substance of the transactions contemplated by this Agreement or the other Transaction Documents is not affectedin any manner materially adverse to any party hereto. Upon such determination that any term or other provision is invalid, illegal orincapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the originalintent of the parties hereto as closely as possible in a mutually acceptable manner in order that the transactions contemplated by thisAgreement or the other Transaction Documents are consummated as originally contemplated to the greatest extent possible.

Section 11.6 Entire Agreement

. This Agreement, the Disclosure Schedules, the other Transaction Documents and the Confidentiality Agreement constitute theentire agreement of the parties hereto with respect to

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the subject matter hereof and thereof and supersede all prior agreements and undertakings, both written and oral, among the partieshereto with respect to the subject matter hereof and thereof.

Section 11.7 No Setoff

. Obligations under this Agreement, including Article VIII, shall not be netted, recouped or set off against any other obligations ofthe parties, whether arising under this Agreement, under any other agreement between the parties hereto, by operation of Law orotherwise, and no other obligations of the parties shall be netted, recouped or set off against obligations under this Agreement,whether arising under the Agreement, under any other agreement between the parties hereto, by operation of Law or otherwise, andeach party hereby waives any such right of setoff, netting or recoupment.

Section 11.8 Assignment

. This Agreement and the rights and obligations hereunder may not be assigned by operation of Law or otherwise without the expresswritten consent of the Seller or the Purchaser (which consent may be granted or withheld in the sole discretion of the Seller or thePurchaser), as the case may be, and any attempted assignment that is not in accordance with this Section 11.8 shall be null and void;provided, that the Purchaser may assign its rights and obligations hereunder without such consent to (i) any Affiliate of thePurchaser, (ii) any Subsidiary of the Purchaser or (iii) any lender, including any Financing Sources (or agent or representativethereof) for collateral purposes, which assignment shall not relieve the Purchaser of its obligations hereunder.

Section 11.9 Amendment

. This Agreement may not be amended or modified except (a) by an instrument in writing signed by, or on behalf of, the Seller andthe Purchaser that expressly references the Section of this Agreement to be amended; or (b) by a waiver in accordance with Section11.10. Notwithstanding anything in this Agreement to the contrary, Section 5.13(b), Section 11.8, this Section 11.9, Section 11.11,Section 11.12(b), Section 11.13 and Section 11.14 and the definitions of “Debt Financing”, “Debt Financing Agreements” and“Financing Sources” (and any provision of this Agreement to the extent an amendment or modification of such provision wouldmodify the substance of any such Section) may not be amended, modified or waived in a manner that adversely affects anyFinancing Source without the prior written consent of such Financing Source adversely affected thereby.

Section 11.10 Waiver

. Any party to this Agreement may extend the time for the performance of any of the obligations or other acts of the other party; waive any inaccuracies in the representations and warranties of the other party contained herein or in any document delivered by theother party pursuant to this Agreement; or waive compliance with any of the agreements of the other party or conditions to suchobligations contained herein. Any such extension or waiver shall be valid only if set forth in an instrument in writing signed by theparties to be bound thereby. Notwithstanding the foregoing, no failure or delay by any party hereto in exercising any right

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hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or future exercise ofany other right hereunder. Any waiver of any term or condition hereof shall not be construed as a waiver of any subsequent breach oras a subsequent waiver of the same term or condition, or a waiver of any other term or condition of this Agreement.

Section 11.11 No Third-Party Beneficiaries

. This Agreement shall be binding upon and inure solely to the benefit of, and be enforceable by, only the parties hereto and theirrespective successors and permitted assigns and nothing herein, express or implied, is intended to, or shall confer upon, any otherPerson any right, benefit or remedy of any nature whatsoever, including any rights of employment for any specified period, under orby reason of this Agreement. Notwithstanding the foregoing, each Financing Source is an express third party beneficiary of Section5.13(b), Section 11.8, Section 11.9, Section 11.11, Section 11.12(b), Section 11.13 and Section 11.14.

Section 11.12 Specific Performance

.

(1) The parties hereto acknowledge and agree that the parties hereto would be irreparably damaged if any of theprovisions of this Agreement are not performed in accordance with their specific terms or are otherwise breached and that any non-performance or breach of this Agreement by either party hereto could not be adequately compensated by monetary damages aloneand that the parties hereto would not have any adequate remedy at Law. Accordingly, in addition to any other right or remedy towhich any party hereto may be entitled, at Law or in equity (including monetary damages), such party shall be entitled to enforceany provision of this Agreement by a decree of specific performance and to temporary, preliminary and permanent injunctive reliefto prevent breaches or threatened breaches of any of the provisions of this Agreement, without posting any bond or otherundertaking.

(2) Notwithstanding anything herein to the contrary, the Seller (on behalf of itself, each of its Affiliates andSubsidiaries and any of their respective Representatives) hereby waives any rights or claims against the Financing Sources inconnection with this Agreement or the Debt Financing, whether at law or equity, in contract, in tort or otherwise and the Seller (onbehalf of itself, each of its Affiliates and Subsidiaries and any of their respective Representatives) agrees not to commence (and ifcommenced, agrees to dismiss or otherwise terminate) any Action against any Financing Source in connection with this Agreementor the transactions contemplated hereby (including any Action relating to the Debt Financing). In furtherance and not in limitation ofthe foregoing, it is agreed that no Financing Source shall have any liability for any losses to the Seller or any of its Affiliates orSubsidiaries (or any of their respective Representatives or equityholders) in connection with this Agreement or the transactionscontemplated hereby. Nothing in this Section 11.12(b) shall in any way expand the circumstances in which the Purchaser may beliable under this Agreement or as a result of the transactions contemplated hereby (including as a result of the Debt Financing).

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Section 11.13 Governing Law

. This Agreement and any claim, controversy or dispute arising under or related to this Agreement or the Debt Financing shall begoverned by, and construed in accordance with, the laws of the State of New York, including Sections 5-1401 and 5-1402 of theNew York General Obligations Law without giving effect to any other principles or rules of conflict of laws to the extent suchprinciples or rules would require or permit the application of Laws of another jurisdiction. Except as provided in Section 2.11, eachparty hereto irrevocably agrees that it shall bring any and all Actions or proceedings in respect of any claim arising out of, related to,or in connection with, this Agreement, the Debt Financing or the transactions contemplated hereby, or the relationship between theparties hereto, whether in tort or contract or at law or in equity, exclusively in any New York State court sitting in the Borough ofManhattan (or in the case of claims where the federal courts have and accept jurisdiction, the United States District Court for theSouthern District of New York), and in each case, appellate courts therefrom, and consistent with the foregoing, each of the partieshereto hereby (a) submits (and agrees to cause its controlled affiliates to submit) to the exclusive jurisdiction of such court for thepurpose of any Action, directly or indirectly, arising out of, relating to, or in connection with this Agreement or the Debt Financingbrought by any party hereto; (b) agrees (and agrees to cause its controlled affiliates to submit) that service of process will be validlyeffected by sending notice in accordance with Section 11.3; (c) irrevocably waives and releases, and agrees not to assert or support(and agrees to cause its controlled affiliates to so waive, release and agree) by way of motion, defense, or otherwise, in or withrespect to any such Action, any claim, whether actual or potential, known or unknown, suspected or unsuspected, based upon past orfuture events, now existing or coming into existence in the future, that (A) such Action is not subject to the personal jurisdiction ofsuch above-named courts; (B) its property is exempt or immune from attachment or execution in the State of New York; (C) suchAction is brought in an inconvenient forum; (D) that the venue of such Action is improper; or (E) this Agreement (including theDebt Financing) or the transactions contemplated by this Agreement may not be enforced in or by any of such above-named courts;and (d) agrees not to move to transfer any such Action to a court other than any of the above-named courts. Notwithstanding theforegoing, with respect to the Owned Real Property only, the laws of the state where the Owned Real Property is located shallcontrol in connection with any matters relating to the Owned Real Property without giving effect to any other principles or rules ofconflict of laws to the extent such principles or rules would require or permit the application of Laws of another jurisdiction.

Section 11.14 Waiver of Jury Trial

. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES (AND AGREES TO CAUSE ITS CONTROLLEDAFFILIATES TO WAIVE) TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVETO A TRIAL BY JURY WITH RESPECT TO ANY ACTION OR LIABILITY, DIRECTLY OR INDIRECTLY, ARISING OUTOF, RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT (INCLUDING THE DEBT FINANCING) OR THETRANSACTIONS CONTEMPLATED BY this Agreement or the other Transaction Documents. EACH OF THE PARTIESHERETO HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS

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REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANYSUCH ACTION OR LIABILITY, SEEK TO ENFORCE THE FOREGOING WAIVER; AND (B) ACKNOWLEDGES THAT ITAND THE OTHER PARTY HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THETRANSACTIONS CONTEMPLATED BY this Agreement or the other Transaction Documents, AS APPLICABLE, BY, AMONGOTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 11.14.

Section 11.15 Counterparts

. This Agreement may be executed and delivered (including by facsimile or other means of electronic transmission, such as byelectronic mail in “pdf” form) in one or more counterparts, and by the different parties hereto in separate counterparts, each of whichwhen executed shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement.

Section 11.16 Interpretation and Rules of Construction.

(3) In this Agreement, except to the extent otherwise provided or that the context otherwise requires:

(a) when a reference is made in this Agreement to an Article, Section, Exhibit or Schedule, such referenceis to an Article or Section of, or an Exhibit or Schedule to, this Agreement;

(b) the table of contents and headings for this Agreement are for reference purposes only and do not affectin any way the meaning or interpretation of this Agreement;

(c) whenever the words “include,” “includes” or “including” are used in this Agreement, they are deemedto be followed by the words “without limitation”;

(d) the words “hereof,” “herein” and “hereunder” and words of similar import, when used in thisAgreement, refer to this Agreement as a whole and not to any particular provision of this Agreement;

(e) all terms defined in this Agreement have the defined meanings when used in any certificate or otherdocument delivered or made available pursuant hereto, unless otherwise defined therein;

(f) where used with respect to information, the phrases “delivered” or “made available” shall mean thatthe information referred to has been physically or electronically delivered to the relevant parties or their respectiveRepresentatives, including, in the case of “made available” to the Purchaser, material that has been posted in a “data room”(virtual or otherwise) established by the Seller;

(g) references to “day” or “days” are to calendar days;

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(h) the definitions contained in this Agreement are applicable to the singular as well as the plural forms ofsuch terms;

(i) references to a Person are also to its successors and permitted assigns;

(j) the word “or” shall be disjunctive but not exclusive;

(k) when calculating the period of time before which, within which or following which any act is to bedone or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded.If the last day of such period is not a Business Day, the period in question shall end on the next succeeding Business Day;and

(l) references to sums of money are expressed in lawful currency of the United States of America, and “$”refers to U.S. dollars.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed as of the date first writtenabove by its respective officers thereunto duly authorized.

ALBEMARLE CORPORATION

By: /s/ Karen G. Narwold

Karen G. NarwoldExecutive Vice President, Chief Administrative Officer, General Counsel & Corporate Secretary

[Signature Page to Sale, Purchase and Contribution Agreement]

W. R. GRACE & CO.-CONN.

By: /s/ William Dockman

Name: William DockmanTitle: SVP, Chief Financial Officer

FINE CHEMICAL MANUFACTURING SERVICES LLC

By: /s/ William Dockman

Name: William DockmanTitle: SVP, Chief Financial Officer

[Signature Page to Sale, Purchase and Contribution Agreement]

ElizabethC.BrownSenior Vice President and

Chief Human Resources Officer

T +1 410.531.4664M +1 410.531.4233

[email protected]

W. R. Grace & Co.7500 Grace Drive

Columbia, MD 21044

November 13, 2020

Cherée Johnson

Dear Cherée:

This letter specifies the terms of your employment with W. R. Grace & Co. (the “Company”), as approved by the Board of Directors (the “Board”)of the Company and/or the Compensation Committee of the Board, as applicable. I am very pleased that you have agreed to join the Companyand believe that you will make a valuable contribution to the Company’s future.

If you accept the terms of this letter, please sign where indicated below and return a copy to me.

PositionandResponsibilitiesYou will join the Company as an employee on January 11, 2021, or another date around that time as agreed by you and the Company. Effectiveupon joining the Company, you will assume the position of “Senior Vice President, General Counsel and Secretary”, with the responsibility ofassisting in the management of all Legal functions at the Company (and of its subsidiary, W. R. Grace & Co.-Conn.) and report directly to HudsonLa Force, the Company’s President and Chief Executive Officer. We anticipate that the Board will elect you as an Executive Officer at the January21, 2021 Board meeting. (As all other Company employees, you will be employed by W. R. Grace & Co.-Conn., a 100% owned subsidiary of theCompany, but will be elected an officer of both W. R. Grace & Co. and W. R. Grace & Co.-Conn.). Your office will be located at the Company’sheadquarters in Columbia, Maryland.

At all times, you will be an employee of the Company “at will” with no definite term of employment, and you will be subject to the samerequirements as other salaried employees of the Company, except as provided under this letter.

CompensationUpon joining the Company, you will be entitled to the following:

Your initial annual base salary will be $400,000. This position is considered a salaried exempt position. You will be paid monthly on the 12th ofeach month.

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1. Your base salary will be subject to periodic review at the same intervals applicable to other similarly situated Grace salariedemployees, generally every 18 to 24 months. Performance reviews will be conducted annually.

2. Your salary will cease to accrue immediately upon your termination of employment with the Company, regardless of the reason forsuch termination.

3. You will participate in the Company’s Annual Incentive Compensation Program (the “AICP”) for 2021. For that calendar year, yourtargeted award under the Program will be 70% of your annual base salary, based on the applicable financial performance of the Company andyour individual performance during that year, subject to the terms of the Program. The cash payment you may receive under the AICP for 2021will be prorated based upon the period of time of your active employment with Grace during the 2020 calendar year.

We also anticipate that your targeted award under future AICP Programs will be no less than 70% of your annual base salary for the applicablecalendar year, pending of course any redesign of the Program in the future by the Company’s Board or its Compensation Committee. The designof AICP bonuses will be determined by the Company, and there are no guarantees with respect to how any design changes will affect futureAICP bonus payments to you.

4. You will receive a sign-on bonus of $100,000, paid to you within 30 days of your first day of employment, subject to re-payment provisionsif you should leave the Company voluntarily within the first year of employment. Your sign on bonus is subject to state and federal taxes whereapplicable.

5. You will receive a sign-on grant of “restricted stock units” on Grace Stock (“RSUs”) valued at $300,000. The RSUs will vest in equaltranches on the first and second anniversary of the date of grant, provided you are employed by the Company on that date. The actual numberof RSUs granted to you under your award will be calculated as follows: the appropriate dollar value of the RSU award divided by the “marketprice” of a share of Grace’s common stock on the date of grant. In the event of an involuntary termination, any unvested RSUs will vest. Youwill receive further information in the grant documents that will be provided after your hire.

LongTermIncentiveCompensation

You will be eligible to receive a grant under the Company’s Long-Term Incentive Plan in February 2021 (the “2021 LTIP”), with a total targetedaward value of $450,000. The design of the Program is still being determined and you will receive this grant at the same time other eligibleCompany employees receive a 2021 LTIP grant. You will receive further information regarding the terms of the 2021 LTIP in a separate memo.

Future LTIP awards will be based on your performance, the program design, and other factors deemed appropriate by senior management andthe Board. The timing and terms of any LTIP award will be the same as the terms governing the awards of the other participants in the Company.All LTIP awards are subject to the approval of the Compensation Committee of the Board of Directors.

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StockOwnershipGuidelinesIn order to ensure· that the long-term financial interests of our directors and key executives are fully aligned with the long-term interests of ourstockholders, our Board of Directors has implemented stock ownership guidelines. The stock ownership guideline for your position is 3X basesalary and you will have five years from your date of hire to comply with the guideline.

SeveranceCoverageUpon joining the Company, you will be covered by the Severance Plan for Leadership Team Officers of Grace. A copy of that Plan is enclosedfor your reference.

ExecutiveSeveranceArrangement(Change-In-Control)When, as anticipated, the Board elects you as an executive officer, the Company will enter into a written Executive Severance Agreement, or aso-called “golden parachute”, with you. In general, the terms of that agreement will provide for a severance payment of 3.0 times the sum of yourannual base salary plus your targeted annual incentive compensation award (adjusted in accordance with the terms of that agreement), andcertain other benefits, in the event your employment terminates under certain conditions following a change-in-control of the Company. The formand provisions of your Executive Severance Agreement will be the same as applicable to other elected officers of the Company. You will beprovided with that agreement under separate cover.

ExecutivePhysical

You will also be eligible for an annual “executive physical” performed at Johns Hopkins Hospital in Baltimore, at Company expense. The terms ofthe physical will be the same as applicable to other elected officers of the Company based in Maryland.

Vacation

You will be eligible for 20 days of paid vacation, in addition to the normal observed holidays and floating holidays. Your vacation will not beprorated for 2021 based on your intended start date.

OtherBenefitProgramsYou will also be eligible to participate in the benefit plans and programs generally available to similarly situated employees and officers of theCompany (subject to the continuation of the plans and programs, and as amended from time to time). I have included a summary of Grace’sbenefits plans currently provided to salaried employees.

Pre-employmentRequirementsPrior to joining Grace, you will be required to undergo a drug screening test. Please send the following information to Ann Goluboff R.N., in ourMedical Department at [email protected] to schedule an appointment locally in your area: Name, Address, Work Location, Position, PhoneNumber, Start Date and Email address.

This offer of employment is contingent upon successfully completing the drug screening test, background check, and your provided documentationestablishing your eligibility to work in the United

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States. Upon acceptance of your offer, you will need to schedule and take your drug screen within 5 business days or offer will be null and void.

Acceptance of this offer indicates that you will be an employee “at will” of Grace and commits neither you nor Grace to any duration ofemployment. You will have the same responsibilities, and be subject to the same requirements, as other similarly situated Grace salariedemployees.

NewHireInformation

Upon written acceptance of this offer, you will receive a “Welcome to Grace” email from our Onboarding system with instructions on how to accessour Global Onboarding and Orientation System. This email will include important information regarding the I-9 process. Please log in as soon aspossible to begin your onboarding tasks for this will expedite your onboarding to Grace. We look forward to having you join our organization, andwe know that you will be a valuable addition to Grace. Please acknowledge acceptance of this offer below and return a signed copy to myattention along with the signed New Hire Agreement. Should you have any questions, please email Stephanie Wheeler [email protected].

ConfidentialityandNon-Compete

In addition, as a condition of commencing employment, you will be required to sign the Company’s New Hire Officer Agreement, a copy of which isenclosed, and which includes provisions regarding the confidentiality of Company information, and non-competition and other provisions.

IndemnificationThe Company shall, to the extent permitted by applicable law, indemnify you and hold you harmless from and against any and all losses andliabilities you may incur as a result of your performance of your duties as an officer or employee of the Company. In addition, the Company shallindemnify and hold you harmless against any and all losses and liabilities that you may incur, directly or indirectly, as a result of any third partyclaims brought against you (other than by any taxing authority) with respect to the Company’s performance of (or failure to perform) anycommitment made to you under this letter. The Company shall obtain such policy or policies of insurance as it reasonably may deem appropriateto effect this indemnification.

Miscellaneous

Cherée, in consideration of your employment by the Company, in the future, effective upon your cessation of employment with the Company or atany other time at the request of the Company, you agree that you will resign as a director, partner, officer and/or any other position of each director indirect subsidiary of the Company and/or of any other business entity directly or indirectly controlled by the Company, and to transfer to theCompany any stock or other interest in any such subsidiary or business entity (which you may hold as a result of your employment with theCompany). Also, at the request of the Company, and at its cost, you agree to execute any statement or document, or take such other action, toeffectuate such resignations and transfers. (Note, this provision does not apply to any equity you may hold in the Company, only to direct orindirect subsidiaries of the Company.) You also agree to

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return all Company property to the Company, effective upon your cessation of employment or at any other time at the request of the Company.

This letter is intended to summarize certain benefits that you will be entitled to under benefit plans and policies of Grace as a result of youremployment by Grace in the capacity specified. This summary does not purport to be complete and is qualified in its entirety by reference to thefull text of such plans and policies. In the event of any conflict between this letter and such plans and policies, the terms of such plans and policieswill control. This letter does not give rise to any legal obligations on the part of Grace beyond those specified in such plans and policies.

Cherée, again, we are very excited about your decision to join Grace and look forward to a productive and rewarding relationship.

Sincerely,

/s/ Elizabeth C. BrownElizabeth C. BrownSenior Vice President and Chief Human Resources Officer

ACCEPTED:

/s/ Cherée Johnson

Date: 11/16/20

Enclosurescc: H. La Force

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EXHIBIT21

W.R.GRACE&CO.,aDelawarecorporation

U.S.SUBSIDIARIES

SUBSIDIARYNAME STATEOFINCORPORATIONAlltech Associates, Inc. ILGloucester New Communities Company, Inc. NJGrace Chemical Company of Cuba ILGrace Collections, Inc. DEGrace Energy Corporation DEGrace Management Services, Inc. DEGrace PAR Corporation DEGrace Technologies, Inc. DEGuanica-Caribe Land Development Corporation DEKootenai Development Company MTW. R. Grace Capital Corporation NYW. R. Grace International LLC DEW. R. Grace & Co.-Conn. CTW. R. Grace Land Corporation NY

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EXHIBIT21

NON-U.S.SUBSIDIARIES

COUNTRY/SUBSIDIARYNAME

ABUDHABIFREEZONEGrace Refining Technologies Middle East Trading Ltd.AUSTRALIAAlltech Associates (Australia) Pty. Ltd.BRAZILW. R. Grace Brasil Indústria e Comércio de Produtos Quimicos Ltda.CANADAGEC Divestment Corporation Ltd.W. R. Grace Canada Corp.CHINA–PEOPLE’SREPUBLICOFGrace Catalysts (Qingdao) Company LimitedGrace Trading (Shanghai) Co. Ltd.CUBAEnvases Industriales y Comerciales, S.A.Papelera Camagueyana, S.A.**FRANCEAlltech France S.A.R.L.GERMANYAlltech Grom GmbHGrace Germany GmbH (fka Grace Energy GmbH)Grace Europe Holding GmbHGrace GmbH (fka Grace GmbH & Co. KG)Grace GP GmbHGrace Management GP GmbHGrace Silica GmbHMertus 366. GmbHHONGKONGW. R. Grace Trading (Hong Kong) LimitedHUNGARYGrace Értékesito Kft.INDIAGrace Davison Chemicals India Pvt. Ltd.IRELANDGrace European Finance (Dublin) LimitedITALYAlltech Italia S.R.L.Grace Italy S.r.l.JAPANW. R. Grace Japan K.K.KOREAW. R. Grace Korea Inc.

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EXHIBIT21

W. R. Grace Korea LimitedLUXEMBOURGGrace Luxembourg S.à r.l.MALAYSIAW. R. Grace Specialty Chemicals (Malaysia) Sdn. Bhd.MEXICOGrace Holdings, S.A. de C.V.NETHERLANDSAlltech Applied Science B.V.Denac Nederland B.V.Grace Netherlands B.V.OMANGrace Catalysts LLCPHILIPPINESGrace Global Operations Center (Philippines) Inc.RUSSIAGrace CIS LLCSINGAPOREGrace Products (Singapore) Private LimitedSOUTHAFRICAGrace Products South Africa (Private) LimitedSPAINGrace Catalysts & Materials S.L.U.SWEDENGrace Catalyst ABTHAILANDW. R. Grace Trading (Thailand) LimitedTURKEYGrace Turkey Kimyevi Madde Hizmetleri Anonim Şirketi (Grace Turkey Chemicals Services Inc.)UNITEDKINGDOMAlltech Associates Applied Science Limited

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EXHIBIT23

ConsentofIndependentRegisteredPublicAccountingFirm

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-224767, 333-194171) of W. R. Grace &Co. of our report dated February 25, 2021 relating to the financial statements and financial statement schedule and the effectiveness of internalcontrol over financial reporting, which appears in this Form 10-K.


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EXHIBIT24

POWER OF ATTORNEY

The undersigned hereby appoints WILLIAM C. DOCKMAN, CHERÉE H. JOHNSON, and SEAN E. DEMPSEY ashis/her true and lawful attorneys-in-fact for the purpose of signing the Annual Report on Form 10-K of W. R. GRACE &CO. for the year ended December 31, 2020, and all amendments thereto, to be filed with the Securities and ExchangeCommission. Each of such attorneys-in-fact is appointed with full power to act without the others.

Robert F. Cummings, Jr. /s/ Robert F. Cummings, Jr. Dated: The 6th day of February 2021Julie Fasone Holder /s/ Julie Fasone Holder Dated: The 5th day of February 2021Diane H. Gulyas /s/ Diane H. Gulyas Dated: The 5th day of February 2021Henry R. Slack /s/ Henry R. Slack Dated: The 8th day of February 2021Christopher J. Steffen /s/ Christopher J. Steffen Dated: The 5th day of February 2021Mark E. Tomkins /s/ Mark E. Tomkins Dated: The 5th day of February 2021Shlomo Yanai /s/ Shlomo Yanai Dated: The 7th day of February 2021

EXHIBIT31(i).1CERTIFICATIONOFPERIODICREPORTUNDERSECTION302OF

THESARBANES-OXLEYACTOF2002I, Hudson La Force, certify that:

1. I have reviewed this annual report on Form 10-K of W. R. Grace & Co.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary tomake the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the periodcovered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all materialrespects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (asdefined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange ActRules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known tous by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed underour supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financialstatements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusionsabout the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on suchevaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant'smost recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or isreasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financialreporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalentfunctions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant'sinternal control over financial reporting.


/s/ HUDSON LA FORCEHudson La ForcePresident and Chief Executive Officer(Principal Executive Officer)

EXHIBIT31(i).2CERTIFICATIONOFPERIODICREPORTUNDERSECTION302OF

THESARBANES-OXLEYACTOF2002I, William C. Dockman, certify that:

1. I have reviewed this annual report on Form 10-K of W. R. Grace & Co.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary tomake the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the periodcovered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all materialrespects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (asdefined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange ActRules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under oursupervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known tous by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed underour supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financialstatements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusionsabout the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on suchevaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant'smost recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or isreasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financialreporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalentfunctions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which arereasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant'sinternal control over financial reporting.


/s/ WILLIAM C. DOCKMANWilliam C. Dockman Senior Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

EXHIBIT32CERTIFICATIONUNDERSECTION906OFTHESARBANES-OXLEYACTOF2002

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350), the undersigned certifies that (1) this Annual Report ofW. R. Grace & Co. (the "Company") on Form 10-K for the period ended December 31, 2020, as filed with the Securities and Exchange Commissionon the date hereof (this "Report"), fully complies with the requirements of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934, asamended, and (2) the information contained in this Report fairly presents, in all material respects, the financial condition and results of operations ofthe Company.

/s/ HUDSON LA FORCEHudson La Force President and Chief Executive Officer(Principal Executive Officer)

/s/ WILLIAM C. DOCKMANWilliam C. Dockman Senior Vice President and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)


A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company andfurnished to the Securities and Exchange Commission or its staff upon request.

EXHIBIT95

MINESAFETYDISCLOSURES

The following table provides information about citations, orders and notices issued from the Mine Safety and Health Administration (the“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the “Mine Act”) during fiscal year 2020.

Mine

§104S&S*Citations

(#)

§104(b)Orders(#)

§104(d)Citationsand

Orders(#)

§110(b)(2)Violations

(#)

§107(a)Orders(#)

TotalDollarValueofMSHAAssessments

Proposed($)

TotalNumberofMining-Related

Fatalities(#)

ReceivedWrittenNoticeofPatternofS&S*Violationsunder§104(e)

(yes/no)

ReceivedNoticeofPotentialtohavePatternofS&S*Violationsunder

§104(e)(yes/no)

Clay Mine Aiken, SC — — — — — 615 — No No

____________________________________________________________________________________________________* S&S refers to violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of a coal or other mine safety or

health hazard under §104 of the Mine Act.

The following tables provide information about legal actions before the Federal Mine Safety and Health Review Commission (the “FMSHRC”)during fiscal year 2020.

Mine

PendingasofDecember31,2020

(#)Institutedduringfiscalyear2020

(#)Resolvedduringfiscalyear2020

(#)

Clay Mine Aiken, SC — — —

WithRespecttoLegalActionsPendingasofDecember31,2020

Mine

ContestsofCitationsandOrdersperSubpartB*

(#)

ContestsofProposedPenaltiesperSubpart

C*(#)

ComplaintsforCompensationperSubpart

D*(#)

ComplaintsofDischarge,Discriminationor

InterferenceperSubpartE*(#)

ApplicationsforTemporaryReliefper

SubpartF*(#)

AppealsofJudge’sDecisionsorOrderstotheFMSHRCperSubpart

H*(#)

Clay Mine Aiken, SC — — — — — —

____________________________________________________________________________________________________* 29 CFR part 2700.