The Company maintained accruals of $6 million for claims aggregating $47 million in Brazil as of September 30, 2026. The amounts accrued represent claims that are deemed probable of loss and are reasonably estimable based on the Company's assessment of the claims and prior experience with similar matters.

The Company is contesting an approximately $52 million assessment by the Brazilian tax authorities related to the application of reduced PIS/COFINS tax rates for certain operations in the Manaus Free Trade Zone. While an unfavorable outcome is reasonably possible, the Company believes its tax treatment is appropriate and is defending its position and accordingly has not recorded an accrual for this matter as of September 30, 2026.

While the Company believes its accruals for litigation and claims are adequate, the final amounts required to resolve such matters could differ materially from recorded estimates and the Company's results of operations and cash flows could be materially affected.

Amounts accrued for product warranty and recall claims are based on management’s best estimates of the amounts that will ultimately be required to settle such items. The Company’s estimates for product warranty and recall obligations are developed with support from its sales, engineering, quality, and legal functions and include due consideration of contractual arrangements, past experience, current claims and related information, production changes, industry and regulatory developments, and various other considerations. During the nine months ended September 30, 2026 the Company recorded $117 million of warranty expense, including approximately $77 million related to two distinct warranty matters, which were recorded during the three months ended September 30, 2026. Based on information currently available, it is reasonably possible the Company could incur additional warranty charges of up to $20 million in excess of the amount accrued for one of the matters. The Company can provide no assurances that it will not experience an adjustment to this, or other material claims in the future or that it will not incur significant costs to defend or settle such claims beyond the amounts accrued or beyond what the Company may recover from its suppliers.

Various legal actions, governmental investigations and proceedings and claims are pending or may be instituted or asserted in the future against the Company, including those arising out of alleged defects in the Company’s products; governmental regulations relating to safety; employment-related matters; customer, supplier and other contractual relationships; intellectual property rights; product warranties; customs and international trade regulations; product recalls; product liability claims; and environmental matters. Some of the foregoing matters may involve compensatory, punitive or antitrust or other treble damage claims in very large amounts, or demands for recall campaigns, environmental remediation programs, sanctions, or other relief which, if granted, would require very large expenditures. The Company enters into agreements that contain indemnification provisions in the normal course of business for which the risks are considered nominal and impracticable to estimate.

Contingencies are subject to many uncertainties, and the outcome of individual litigated matters is not predictable with assurance. Reserves have been established by the Company for matters discussed in the immediately foregoing paragraphs where losses are deemed probable and reasonably estimable. It is possible, however, that some of the matters discussed in the foregoing paragraphs could be decided unfavorably to the Company and could require the Company to pay damages or make other expenditures in amounts, or a range of amounts, that cannot be estimated as of September 30, 2026 and that are in excess of established reserves. The Company does not reasonably expect, except as otherwise described herein, based on its analysis,