In July 2025, the One Big Beautiful Bill Act (OBBBA) was enacted. Key income tax related provisions of the OBBBA include the repeal of mandatory capitalization of research and development expenditures under Internal Revenue Code (IRC) Section 174 (reinstating full expensing beginning in 2025) and extension of bonus depreciation. The Company recognized the income tax effects of the OBBBA in its 2025 financial statements, including a $29 million decrease to both income taxes payable and to current income tax expense, and a $29 million increase to deferred tax expense and a $29 million decrease to deferred tax assets as of December 31, 2025. The change in the tax law had no significant impact to the Company’s annual effective tax rate.

The effective tax rate in 2025 decreased to 19.3% from 20.9% in 2024. The change in the effective tax rate was due primarily to a change in the jurisdictional mix of earnings, decreases in the change of valuation allowance on NOLs and non-deductible executive compensation subject to Section 162(m), an increase in untaxed income attributable to noncontrolling interests, and an increase in business tax

credits, partially offset by decreases in foreign-derived intangible income (FDII) deduction and the windfall equity-based compensation deduction.

The effective tax rate in 2024 decreased to 20.9% from 21.3% in 2023. The change in the effective tax rate was due primarily to tax benefits related to increases in the foreign-derived intangible income (FDII) deduction and increased equity-based compensation deductions, partially offset by an increase in valuation allowance on NOLs and non-deductible executive compensation subject to Section 162(m).

The Company is not asserting that any of the earnings of the foreign subsidiaries will be permanently reinvested. Therefore, the Company has recorded a deferred tax liability for the undistributed earnings net of applicable foreign tax credits.

The Company assesses the realizability of its deferred tax assets each reporting period through an analysis of potential sources of taxable income, including prior year taxable income available to absorb carryback of tax losses, reversals of existing taxable temporary differences, tax planning strategies, and forecasts of taxable income. The Company considers all negative and positive evidence, including the weight of the evidence, to determine if a valuation allowance against deferred tax assets is required. A valuation allowance is recorded against deferred tax assets to reflect the amount of deferred tax assets that is determined to be more-likely-than-not to be realized.

As of December 31, 2025, and December 31, 2024, the Company’s valuation allowance against deferred tax assets was $50.6 million and $45.3 million, respectively. The Company has recorded a valuation allowance against certain tax attributes that the Company has determined are not more-likely-than-not to be realized, including certain foreign net operating loss carryforwards, foreign tax credit carryforwards, and capital loss carryforwards. From December 31, 2024 to December 31, 2025, the Company’s valuation allowance increased by $5.3 million. This increase relates to deferred tax assets recorded for net operating loss carryforwards and foreign tax credit carryforwards. The valuation allowance is recorded because the Company does not expect to utilize the carryforward amounts before they expire.

As of December 31, 2025, the Company has Net Operating Losses ("NOLs") of $2.0 million, $43.7 million, and $59.6 million for U.S. Federal, U.S. states and foreign jurisdictions, respectively. The utilization of the U.S. federal and U.S. state NOLs are subject to certain annual limitations. Of these NOL amounts, $2.0 million, $17.9 million and $25.1 million in U.S. Federal, U.S. states and foreign jurisdictions, respectively, do not expire. The remaining amounts of NOLs in U.S. states and in foreign jurisdictions will expire if not used between 2026 and 2046.

As of December 31, 2025, the Company has foreign tax credit carryforwards of $39.0 million. The Company has provided a valuation allowance of $39.0 million as the Company considers it is not more likely than not that these credits will be realized. These foreign tax credits start expiring in the year 2029.

At December 31, 2025, and December 31, 2024, there are $26.5 million and $28.6 million of unrecognized tax benefits that if recognized would affect the Company’s effective tax rate.

The Company recognizes interest and penalties related to unrecognized tax benefits as part of its income tax expense. During the years ended December 31, 2025, December 31, 2024, and December 31, 2023, the Company recognized approximately $0.7 million, $1.0 million, and $0.5 million in interest and penalties, respectively, in the consolidated statements of income. The total amount of interest and penalties accrued in the consolidated balance sheets was $6.3 million, $5.6 million, and $4.6 million as of December 31, 2025, December 31, 2024, and December 31, 2023, respectively.

The Company conducts business globally and, as a result, the Company or one or more of its subsidiaries files income tax returns in the U.S. federal jurisdiction, various U.S. states, and foreign jurisdictions. The Company is subject to examination by tax authorities in several jurisdictions, including jurisdictions where the Company has significant activities, such as Canada, Saudi Arabia, the United Arab Emirates and the United States. As of December 31, 2025, the Company’s U.S. federal income tax returns for tax years 2022 and forward remain subject to examination. U.S. states and foreign income tax returns remain subject to examination based on varying local statutes of limitations.

Although the Company believes its reserves for its tax positions are reasonable, the final outcome of tax audits could be significantly different, both favorably and unfavorably.

The amount of cash income taxes paid (net of refunds received) by the Company during the year ended December 31, 2024 and 2023 was $59.8 million and $74.1 million, respectively.

The change in tax law from OBBBA led to the reduction of 2025 income taxes paid.