In July 2024, the Company indefinitely suspended operations at its Temiscaming HPC plant, idling the plant in a safe and environmentally sound manner. Since the start of the suspension in 2024, the Company has incurred total one-time operating charges of $19 million, including $8 million of mothballing costs, $6 million of severance and other employee costs and $5 million of other costs. No additional one-time charges are expected to be incurred. In conjunction with the suspension of operations, in the third quarter of 2024, the Company recognized a non-cash asset impairment of $25 million, as it was determined that the Temiscaming HPC plant’s net carrying value exceeded its estimated fair value.

In the first quarter of 2026, the Company determined to permanently cease DWP production at the site, which removed the primary economic reason for operating the HPC plant. Consequently, the plant assets’ useful lives were reduced to zero and other impacted assets at the Temiscaming site were also reviewed for potential obsolescence. This resulted in non-cash accelerated depreciation charges of $35 million and other asset adjustments of $6 million, which were recorded to the High Purity Cellulose segment in “Temiscaming HPC permanent idling charges” in the condensed consolidated statements of operations.

Certain infrastructure assets of the Temiscaming HPC plant continue to run in support of the ongoing energy and other needs of the Temiscaming PBD and HYP plants, which continue to operate at full capacity, subject to market conditions.


	Mothballing Costs		Severance and Other Employee Costs		Total
Balance at December 31, 2025	$	—	$	670	$	670
Charges incurred	802		153		955
Payments	(802)		(613)		(1,415)
Balance at June 27, 2026	$	—	$	210	$	210


	Three Months Ended				Six Months Ended
	June 27, 2026		June 28, 2025		June 27, 2026		June 28, 2025
Mothballing costs	$	802	$	229	$	802	$	719
Severance and other employee costs	25		—		153		(85)
Suspension charges	$	827	$	229	$	955	$	634

These charges were recorded to the High Purity Cellulose segment in “suspension charges” in the condensed consolidated statements of operations.

In the second quarter of 2026, the Company recognized a non-cash asset impairment of $13 million, as it was determined that the HYP plant asset group’s net carrying value exceeded its estimated fair value as a result of weakened market conditions and reduced future cash flow projections. The impairment was recorded to the PBD & HYP segment in “asset impairment” in the condensed consolidated statements of operations. See Note 9—Fair Value Measurements for further information on the fair value measurement of the HYP plant asset group.