During the first quarter of 2026, the Company decided to discontinue its project to build automated roll warehouses at its Kalamazoo, Michigan and Texarkana, Texas paperboard manufacturing facilities. This decision reflects a shift in operational priorities and the Company's focus on optimizing capital deployment and cost-management efforts. As a result of the cancellation of this project, the Company incurred charges of $40 million within Corporate and Other related to the write-off of assets, which were primarily equipment, site preparation and engineering costs for this project. The costs associated with this project are included in the table below for the six months ended June 30, 2026.

During the six months ended June 30, 2026, the Company implemented additional cost and production optimization initiatives following its review of support functions and other expenses. These initiatives were incremental to the measures taken in the fourth quarter of 2025. During the three and six months ended June 30, 2026, the Company incurred charges of $5 million and $23 million, respectively, within Corporate and Other and the International Paperboard Packaging reportable segment, primarily for severance, in addition to the $6 million incurred in the fourth quarter of 2025. These charges are included in the table below for the three and six months ended June 30, 2026.

During the second quarter of 2026, the Company completed the sale of its Croatia business to a third party for total consideration of $6 million. For the six months ended June 30, 2026, the Company recognized a $13 million charge within the International Paperboard Packaging reportable segment in connection with this sale.

Current Assets and Current Liabilities on the Condensed Consolidated Balance Sheets include $8 million and $2 million, respectively, primarily related to multiple paperboard manufacturing and packaging facilities that met the held for sale criteria as of June 30, 2026. Current Assets on the Condensed Consolidated Balance Sheets include $10 million primarily related to multiple paperboard manufacturing and packaging facilities that met the held for sale criteria as of December 31, 2025. Charges associated with these held for sale assets and liabilities are included in the table below for the three and six months ended June 30, 2026 and 2025. During the three and six months ended June 30, 2026, the Company recognized a gain of $1 million and $5 million, respectively, on the sales of exited properties, which is also included in the table below.

In the fourth quarter of 2025, the Company commenced operations of its new recycled paperboard manufacturing facility located in Waco, Texas. From the project's announcement through completion, the Company incurred $55 million of start-up charges within Corporate and Other. No start-up charges were incurred in 2026 or after the facility became operational in the fourth quarter of 2025. For the three and six months ended June 30, 2025, the Company incurred $10 million and $17 million, respectively, of start-up charges, which are included in the table below.

In connection with the Waco project, the Company closed its Middletown facility in May 2025 and its East Angus facility in December 2025 to consolidate production into fewer, more efficient locations. In the second quarter of 2026, the Company completed the sale of the Middletown facility. The costs associated with these exit activities are included in Corporate and Other, and are included in the table below for the three and six months ended June 30, 2026 and 2025. For the three and six months ended June 30, 2025, the Company incurred charges of $4 million and $8 million, respectively, for accelerated depreciation, which is included in the table below.

During 2024, the Company decided to close multiple packaging facilities. Production from these facilities has been consolidated into other existing packaging facilities. The costs associated with these exit activities are included in the Americas Paperboard Packaging and International Paperboard Packaging reportable segments and are included in the table below for the three and six months ended June 30, 2026 and 2025.


		Three Months Ended June 30,				Six Months Ended June 30,
In millions	Location in Statement of Operations	2026		2025		2026		2025
Asset Write-Offs and Start-Up Costs(a)	Business Combinations, Exit Activities and Other Special Items, Net	$	(1)	$	9	$	54	$	21
Severance Costs and Other(b)	Business Combinations, Exit Activities and Other Special Items, Net	5		4		23		6
Accelerated Depreciation	Cost of Sales	—		4		—		8
Total		$	4	$	17	$	77	$	35

(b) Costs incurred include activities for post-employment benefits, retention bonuses, incentives and professional services (see Note 1. Business Combinations, Exit Activities and Other Special Charges, Net).

(b) Includes approximately $14 million of payments related to other severance and benefits costs included in Corporate and Other, $8 million of payments related to the closure of the East Angus facility and approximately $3 million of payments related to other severance and benefits costs included in the International Paperboard Packaging reportable segment.