In February 2025, Union Electric Steel UK Limited (“UES-UK”), an indirect wholly owned subsidiary of the Corporation, entered into a formal consultation process with its unions and staff to evaluate various options to improve its profitability, which it completed during the second quarter of 2025. The U.K. operations have been impacted by unpredictable and high energy costs compared to its foreign competitors, lower demand for its products manufactured in the U.K., and increased imports of rolls and flat rolled steel into Europe from low-cost countries. In light of UES-UK's historical performance and management's outlook for the remainder of 2025 and subsequent years, UES-UK has decided to exit its operations. As of the September 30, 2025 balance sheet date, no decision had been made by the Directors of UES-UK as to the method to liquidate and dissolve its operations.

For the three and nine months ended September 30, 2025, the Corporation recognized charges approximating $3,069 and $9,819, respectively, primarily for employee-related costs payable to the employees of UES-UK under existing benefit plans; accelerated depreciation from reducing the estimated remaining useful lives and revising the estimated residual values of the property, plant and

equipment of UES-UK; and similar closure costs approximating $800 for the non-core steel distribution facility located in Ohio held by Alloys Unlimited and Processing, LLC. (“AUP”), an indirect wholly owned subsidiary of the Corporation (collectively, the “Exit Charges”).

The Exit Charges included the following components for the three and nine months ended September 30, 2025:


Type of Cost	Location of Cost in Statement of Operations	Three Months Ended September 30, 2025		Nine Months Ended September 30, 2025
Employee-related costs	Severance charge	$	165	$	6,019
Accelerated depreciation	Depreciation and amortization		2,407		3,061
Loss on sale of assets	Loss (income) on disposal of assets		210		210
Professional fees	Selling and administrative		53		185
Other	Costs of products sold (excluding depreciation and amortization)		234		344
Total Exit Charges		$	3,069	$	9,819

The charge for employee-related costs primarily represents statutory severance and other benefits payable to the approximately 168 employees of UES-UK and the 15 employees of AUP under existing benefit plans. Accelerated depreciation is a non-cash charge and represents primarily higher depreciation expense resulting from reducing the estimated remaining useful lives and revising the estimated residual values of the property, plant and equipment of UES-UK (Note 5) and AUP. Loss on sale of assets is a non-cash charge and represents the loss on the sale of the equipment of AUP during the third quarter of 2025.

Outstanding Exit Charges equaled $5,969 as of September 30, 2025, all of which related to outstanding severance charges, with $5,121 recorded as a current liability (accrued payrolls and employee benefits) and $848 recorded as a noncurrent liability (other noncurrent liabilities) on the condensed consolidated balance sheet as of September 30, 2025. Changes in accrued severance for the three and nine months ended September 30, 2025 consisted of the following:


	Three Months Ended September 30, 2025			Nine Months Ended September 30, 2025
Balance at beginning of the period	$	5,922		$	—
Provision, net		165			6,019
Paid		—			—
Other, primarily changes in foreign currency exchange rates		(118	)		(50	)
Balance at end of the period	$	5,969		$	5,969

On October 13, 2025, subsequent to the September 30, 2025 balance sheet date, the Directors of UES-UK voluntarily filed a Notice of Intention to appoint certain insolvency practitioners of FRP Advisory Trading Limited (“FRP”) as administrators of UES-UK (collectively, the “Administrators”) pursuant to the requirements of the Insolvency Act 1986 of England and Wales in the High Court of Justice, Business and Property Courts at Leeds (the “Insolvency Court”). On October 14, 2025, (the “Filing Date”), the Directors of UES-UK filed a Notice of Appointment with the Insolvency Court formally appointing the Administrators as administrators of UES-UK. This action was confined to UES-UK exclusively and did not affect the Corporation or any of its other subsidiaries.

As of the Filing Date, UES-UK was in administration and its affairs, business and property were being managed by the Administrators (the “Structured Insolvency”). The Administrators will set out their proposals to UES-UK’s creditors, which will likely include an orderly wind-down of UES-UK’s financial affairs and sale of its assets. Any funds remaining after the costs and expenses associated with the Structured Insolvency will be distributed in the order of priority set forth in the Insolvency Act 1986.

Through October 13, 2025, the date immediately prior to the Filing Date, the operating results of UES-UK were included in the consolidated operating results of the Corporation. Effective as of the Filing Date, the Corporation no longer consolidates the operating results of UES-UK, as the Corporation no longer has decision-making control over UES-UK. In addition, as of the Filing Date, the Corporation (i) wrote down its investment in UES-UK to its estimated fair value; (ii) recognized the other comprehensive losses of UES-UK deferred in accumulated other comprehensive loss; and (iii) established a receivable for the estimated amount of funds expected to be returned to the lenders under the Corporation's Second Amended and Restated Revolving Credit, Term Loan and Security Agreement (the “Credit Agreement”), if any, after the costs and expenses of the Structured Insolvency.

As of September 30, 2025, (i) the Corporation's carrying value of its investment in UES-UK approximated $23,000 and, since the fair value of UES-UK’s liabilities exceeded the fair value of its assets, the estimated fair value of UES-UK approximated $0; (ii) the amount of other comprehensive losses of UES-UK deferred in accumulated other comprehensive loss approximated $29,000; and (iii) the amount of funds expected to be returned to the lenders under the Credit Agreement approximated between $7,000 to $9,000. Accordingly, the Corporation expects to recognize a non-cash impairment charge in the fourth quarter of 2025, ranging between $43,000 and $45,000, based on estimates as of September 30, 2025. As of the Filing Date, the Corporation expected its future cash expenditures associated with the Structured Insolvency to be insignificant.