The Company is party to multiple cloud computing agreements that are service contracts for enterprise resource planning (ERP) software programs and payroll services. The amortization period of the cloud computing agreement for the previous ERP software program was adjusted during the year ended December 31, 2024, to align with implementation of the new ERP software and is now fully amortized. The amortization of the new ERP software began on January 1, 2026, and is being amortized over a period of five years.

The amortization associated with the payroll services agreement began in 2024 and is being amortized over a period of five years.

The capitalized implementation costs are classified on the consolidated balance sheets as follows:


	June 30,			December 31,
	2026			2025
	(In thousands)
Cloud computing costs included in other current assets	$	1,362		$	37
Cloud computing costs included in other assets		6,821			8,709
Amortization of cloud computing costs		(2,044	)		(1,621	)
Total capitalized cloud computing costs	$	6,139		$	7,125

The Company is party to production contracts with General Motors LLC (GM) to supply fabricated, multi-part thermal barriers (Barriers) for use in the battery system of its current and next-generation EVs (Contracts). Pursuant to the Contracts, the Company is obligated to supply Barriers at fixed periodic prices and at volumes to be specified by the original equipment manufacturer (OEM) up to a daily maximum quantity through the respective terms of the agreements, which expire at various times from 2030 through 2034 and, in certain cases, may be extended by GM. While the OEM has agreed to purchase its requirement for Barriers from the Company for locations to be designated from time to time by the OEM, it has no obligation to purchase any minimum quantity of Barriers under the Contracts. In addition, the OEM may terminate the Contracts any time and for any or no reason. All other terms of the Contracts are generally consistent with the OEM’s standard purchase terms, including quality and warranty provisions that are customary in the automotive industry.

The Company has provided certain customers with letters of credit securing obligations under commercial contracts. As of June 30, 2026, the Company had $1.7 million of restricted cash to support its outstanding letters of credit. The Company had letters of credit outstanding of $1.7 million at December 31, 2025 and these letters of credit were secured by the Company’s restricted cash.

The Company is subject to federal, state and local environmental laws and regulations. These laws generally provide for control of pollutants released into the environment and require responsible parties to undertake remediation. Penalties may be imposed for noncompliance.

The Company is, from time to time, a party to litigation that arises in the normal course of its business operations. See Part II, Item 1 “Legal Proceedings” of this Quarterly Report on Form 10-Q for a description of certain of the Company’s current legal proceedings. The Company is not presently a party to any litigation for which it believes a loss is probable requiring an amount to be accrued or a possible loss contingency requiring disclosure.

As of June 30, 2026, the Company had purchase commitments of approximately $44.0 million, which included capital commitments of $1.6 million. Purchase commitments related to capital expenditures are anticipated to be spent over the next three years, while the Company's remaining purchase commitments are anticipated to be spent throughout 2026.

Purchase obligations relate primarily to open purchase orders for capital expenditures, inventories, and goods and services. Purchase obligations are entered into with various vendors in the normal course of business and are consistent with the Company's expected requirements.

The Company offers warranties to its customers depending upon the specific product.

The Company’s standard warranty period for energy industrial products extends to one year from the date of shipment. This standard warranty provides that the Company’s products will be free from defects in material and workmanship, and will, under normal use, conform to the specifications for the product.

The Company’s thermal barrier products provide quality and warranty provisions customary in the automotive industry.

The Company recorded warranty expense of $0.2 million during the six months ended June 30, 2026 and $0.5 million during the six months ended June 30, 2025.