CR US Equity☆

Item 1A. Risk Factors Page 13

Item 1B. Unresolved Staff Comments Page 25

Item 2. Properties Page 26

Item 3. Legal Proceedings Page 27

Item 4. Mine Safety Disclosures Page 27

Part II

Item 6. [Reserved] Page 29

Item 7A. Quantitative and Qualitative Disclosures About Market Risk Page 67

Item 8. Financial Statements and Supplementary Data of Crane Page 70

Item 9A. Controls and Procedures Page 164

Item 9B. Other Information Page 167

Part III

Item 10. Directors, Executive Officers and Corporate Governance Page 168

Item 11. Executive Compensation Page 177

Item 14. Principal Accountant Fees and Services Page 213

Part IV

Item 15. Exhibits and Financial Statement Schedules Page 214

Signatures Page 217

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PRESENTATION OF INFORMATION

Except as otherwise indicated or unless the context otherwise requires, the information included in this Annual Report on Form

10-K, including the supplemental combined financial statements of Crane Company, which are comprised of the assets and liabilities of all of Crane’s (as defined below) businesses (excluding its

Payment & Merchandising Technologies business), including its Aerospace & Electronics and Process Flow Technologies global growth platforms, as well as its Engineered Materials segment, assumes the completion of all the

transactions referred to in this Annual Report in connection with the separation and distribution (together, the “spin-off”). Unless the context otherwise requires or as otherwise specified herein,

references in this Annual Report to (i) “Crane Holdings, Co.” refers to the Delaware corporation Crane Holdings, Co., prior to the closing of the spin-off, (ii) “Crane” refers to Crane

Holdings, Co. and its consolidated subsidiaries (including Crane Company and its combined subsidiaries), in each case, prior to giving effect to the spin-off, (iii) “Crane Company” refers to the

Delaware corporation Crane Company, which is the registrant and the company whose shares of common stock will be distributed to the stockholders of Crane Holdings, Co in the distribution, (iv) the “Company,” “we,”

“us,” and “our” refer to Crane Company and its combined subsidiaries, in each case, after giving effect to the spin-off, (v) “Crane NXT, Co.” refers to the Delaware corporation Crane NXT, Co. (which shall be known as

Crane Holdings, Co. prior to the completion of the spin-off), following the closing of the spin-off and (vi) “Crane NXT” refers to Crane NXT, Co. and its

consolidated subsidiaries (other than Crane Company and its combined subsidiaries), in each case, after giving effect to the spin-off.

FINANCIAL STATEMENT INFORMATION

This Annual Report on Form 10-K includes certain historical consolidated financial and other data for Crane and certain supplemental historical combined financial and other data for the Company. Financial statements of the registrant, Crane

Company, have not been included in this Annual Report on Form 10-K as it was a newly incorporated entity and had no material business transactions or activities as of the end of the period covered by this Annual Report on Form 10-K. In connection

with the spin-off, Crane Company will become a stand-alone, publicly traded company and the direct or indirect holder of the assets and liabilities of all of Crane’s businesses (excluding its

Payment & Merchandising Technologies business), including its Aerospace & Electronics and Process Flow Technologies global growth platforms, as well as its Engineered Materials segment. Crane Company is the registrant and will be

the financial reporting entity following the completion of the spin-off. Crane Holdings, Co., which will be renamed “Crane NXT, Co.”, is presently, and will continue to be, a financial reporting

entity following the spin-off. Notwithstanding the legal form of the spin-off described elsewhere in this Annual Report on Form 10-K, for accounting and financial

reporting purposes, Crane’s Payment & Merchandising Technologies segment will be presented as being spun-off from Crane (the reverse of its legal form—a “reverse spin”). This

presentation is in accordance with generally accepted accounting principles in the U.S. (“GAAP”), specifically Financial Accounting Standards Board (“FASB”) Accounting Standards Codification

505-60, “Spinoff and Reverse Spinoffs,” and is primarily a result of, among other factors, Crane Company’s (which is the legal spinnee) larger operations, greater tangible assets, greater fair

value and greater net sales, in each case, relative to Crane NXT. Further, Crane has determined that Crane best represents the predecessor entity to Crane Company. As such, the historical audited consolidated financial statements included under Item

8 in this Annual Report are Crane’s historical financial statements. Crane’s historical results are not representative of the results that Crane Company would have achieved as a separate, publicly traded company nor indicative of the

results expected for any future period. As a result, Item 8 of this Annual Report also includes supplemental historical audited combined financial statements of Crane Company, which were prepared on a

“carve-out” basis and derived from Crane’s consolidated financial statements and accounting records. These supplemental combined financial statements reflect Crane Company’s combined

historical financial position, results of operations and cash flows as they were historically managed in accordance with GAAP. The supplemental combined financial statements may not be indicative of Crane Company’s future performance and do not

necessarily reflect what the financial position, results of operations and cash flows would have been had Crane Company operated as an independent, publicly traded company during the periods presented, particularly because of changes Crane Company

expects to experience in the future as a result of the spin-off. Due to rounding, numbers presented throughout this Annual Report on Form 10-K may not add up precisely to totals we provide and percentages may

not precisely reflect the absolute figures.

MARKET, INDUSTRY AND OTHER DATA

Unless otherwise indicated, information contained in this Annual Report concerning our industry and the markets in which we operate, including our general expectations

and market position, market opportunity and market share, is based on information from third-party sources, our own analysis of data received from these third-party sources, our own internal data, market research that we commission and management

estimates. Our management estimates are derived from publicly available information, our knowledge of our industry and assumptions based on such information and knowledge, which we believe to be reasonable. Assumptions and estimates of our and our

industry’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described under the section of this Annual Report entitled “Risk Factors.” These and other

factors could cause future performance to differ materially from our assumptions and estimates. For additional information, see the sections of this Annual Report entitled “Risk Factors” and “Forward-Looking Statements.”

TRADEMARKS AND TRADE NAMES

We own or have rights to use the trademarks and

trade names that we use in conjunction with the operation of our business. This Annual Report also contains additional trade names, trademarks and service marks belonging to other companies. We do not intend our use or display of other parties’

trademarks, trade names or service marks to imply, and such use or display should not be construed to imply, a relationship with, or endorsement or sponsorship of us by, these other parties.

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FORWARD-LOOKING INFORMATION

This Annual Report on Form 10-K contains information about Crane Company, the registrant, and its direct parent, Crane Holdings, Co., some of which includes

“forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements other than historical information or statements about our current condition. You can

identify forward-looking statements by the use of terms such as: “believes,” “contemplates,” “expects,” “may,” “will,” “could,” “should,” “would,” or

“anticipates,” other similar phrases, or the negatives of these terms.

We have based the forward-looking statements relating to our operations on our

current expectations, estimates and projections about us and the markets we serve. We caution you that these statements are not guarantees of future performance and involve risks and uncertainties. These statements should be considered in

conjunction with the discussion in Part I, the information set forth under Item 1A, “Risk Factors” and with the discussion of the business included in Part II, Item 7, “Management’s Discussion and Analysis of Financial

Condition and Results of Operations.” We have based many of these forward-looking statements on assumptions about future events that may prove to be inaccurate. Accordingly, our actual outcomes and results may differ materially from what we

have expressed or forecast in the forward-looking statements. Any differences could result from a variety of factors, including the following:

• Our ability to successfully complete our pending separation as planned;

• Our ability to successfully value acquisitions;

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• The ability of the U.S. government to terminate our government contracts;

• A reduction in congressional appropriations that affect defense spending;

• The outcomes of legal proceedings, claims and contract disputes;

Part I

Unless the context otherwise

requires or as otherwise specified herein, references herein to (i) “Crane Holdings, Co.” refers to the Delaware corporation Crane Holdings, Co., prior to the closing of the spin-off, (ii) “Crane” refers to Crane Holdings, Co.

and its consolidated subsidiaries (including Crane Company and its combined subsidiaries), in each case, prior to giving effect to the spin-off, (iii) “Crane Company” refers to the Delaware corporation Crane Company, which is the

registrant and the company whose shares of common stock will be distributed to the stockholders of Crane Holdings, Co in the distribution, (iv) the “Company,” “we,” “us,” and “our” refer to Crane Company and

its combined subsidiaries, in each case, after giving effect to the spin-off, (v) “Crane NXT, Co.” refers to the Delaware corporation Crane NXT, Co. (which shall be known as Crane Holdings, Co. prior to the completion of the spin-off),

following the closing of the spin-off and (vi) “Crane NXT” refers to Crane NXT, Co. and its consolidated subsidiaries (other than Crane Company and its combined subsidiaries), in each case, after giving effect to the spin-off. Amounts in

the following discussion are presented in millions, except employee, square feet, number of properties, share and per share data, or unless otherwise stated.

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Executive Officers of the Registrant

Name Position Business Experience Age ExecutiveOfficer Since

Item 1. Business

General

In March 2022, the board of directors of Crane Holdings, Co.

authorized management to pursue a plan to separate spin-off its Aerospace & Electronics, Process Flow Technologies and Engineered Materials segments to Crane Holdings, Co.’s stockholders (the “spin-off”). On February 7, 2023, the

SEC declared effective the registrant’s Registration Statement on Form 10, filed on December 15, 2022, as amended by Amendment No. 1 to the Registration Statement on Form 10, filed on January 24, 2023. Crane Company, a Delaware corporation and

a direct, wholly owned subsidiary of Crane Holdings, Co., was newly formed for the purpose of separation and has not engaged in any activities except in preparation for the distribution. The registrant expects the spin-off to be consummated on April

3, 2023.

Crane Company

We are a diversified manufacturer of highly engineered

industrial products. Our operations are currently comprised of three segments: Aerospace & Electronics (“A&E”), Process Flow Technologies (“PFT”) and Engineered Materials (“EM”). Our primary end markets

include aerospace, defense and space, process industries, non-residential and municipal construction, along with a wide range of general industrial and certain consumer related end markets.

We have been committed to the highest standards of business conduct since inception in 1855 when our founder, R.T. Crane, resolved “to conduct my business in the

strictest honesty and fairness; to avoid all deception and trickery; to deal fairly with both customers and competitors; to be liberal and just toward employees; and to put my whole mind upon the business.” Our strategy is to grow earnings and

cash flow by focusing on the manufacturing of highly engineered industrial products for specific markets where our scale is a relative advantage, and where we can compete based on our proprietary and

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differentiated technology, our deep vertical expertise, and our responsiveness to unique and diverse customer needs. We continuously evaluate our portfolio, pursue acquisitions that complement

our existing businesses and selectively divest businesses where appropriate. We strive to foster a performance-based culture focused on productivity and continuous improvement, to attract and retain a committed management team whose interests are

directly aligned with those of our shareholders, and to maintain a focused, efficient corporate structure.

We operate a comprehensive set of business processes,

philosophies and operational excellence tools to drive continuous improvement throughout our businesses (collectively, the Crane Business System). Beginning with a core value of integrity, we incorporate “Voice of the Customer” teachings

(specific processes designed to capture our customers’ requirements) and a broad range of tools into a disciplined strategy deployment process to continuously improve safety, quality, delivery, cost and growth. An embedded intellectual capital

development process helps ensure that we attract, develop, promote and retain talent to drive continuity and repeatable results.

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Recent Transactions

Pending Separation

On March 30, 2022, Crane Holdings, Co. announced that

its Board of Directors unanimously approved a plan to pursue a separation into two independent, publicly-traded companies (the “Separation”), Crane Company and Crane NXT, Co. Upon completion of the pending Separation, Crane Holdings, Co.

will be renamed “Crane NXT, Co.” and will continue to operate Crane Holdings, Co.’s Payment & Merchandising Technologies segment. The new company distributed to the stockholders of Crane Holdings, Co. in the Separation, Crane

Company, will hold Crane Holdings, Co.’s Aerospace & Electronics and Process Flow Technologies global growth platforms, as well as Crane Holdings, Co.’s Engineered Materials segment. The Separation is expected to occur through a

tax-free distribution of all of the outstanding shares of Crane Company common stock to holders of Crane Holdings, Co. common stock and is expected to be completed in April, 2023, subject to the satisfaction of customary conditions and final

approval by Crane Holdings, Co.’s Board of Directors. On February 7, 2023, the SEC declared effective our registration statement on Form 10. Each Crane Holdings, Co. stockholder will receive one share of Crane Company common stock for

every one share of Crane Holdings, Co. common stock held on March 23, 2023, the record date for the distribution.

For additional information regarding the

Separation, including risk factors, see the Information Statement of Crane Company, filed as Exhibit 99.1 to the registration statement on Form 10 filed by Crane Company with the SEC on December 15, 2022, as amended by Amendment No. 1 filed with the

SEC on January 24, 2023.

Crane Company Credit Facilities

On March 17,

2023, Crane Company entered into a new senior unsecured credit agreement (the “Credit Agreement”), which provides for (i) a $500 million, 5-year Revolving Credit Facility (the “Revolving Facility”) and (ii) a $300 million, 3-year

term loan facility (the “Term Facility”), funding under each of which will become available substantially concurrently with the spin-off, subject to the satisfaction of customary conditions of facilities of this type. The Revolving

Facility allows us to borrow, repay and re-borrow funds from time to time prior to maturity of the Revolving Facility without any penalty or premium, subject to customary borrowing conditions for facilities of this type and the reimbursement of

breakage costs. Borrowings under the Term Facility are prepayable without premium or penalty, subject to customary reimbursement of breakage costs. Interest on loans advanced under the Credit Agreement accrues, at our option, at a rate per annum

equal to (1) adjusted term SOFR for the applicable interest period plus a margin ranging from 1.50% to 2.25% or (2) a base rate plus a margin ranging from 0.50% to 1.25%, in each case, with such margin determined based on our total net leverage

ratio. We are required to pay a fee on undrawn commitments under the Revolving Facility at a rate per annum that ranges from 0.20% to 0.35%, depending on our total net leverage ratio. The Credit Agreement contains customary affirmative and negative

covenants for credit facilities of this type, including limitations on us and our subsidiaries with respect to indebtedness, liens, mergers, consolidations, liquidations and dissolutions, sales of all or substantially all assets, transactions with

affiliates and hedging arrangements. As of the last day of each quarter, we must also maintain a total net leverage ratio not to exceed 3.50 to 1.00 (which, at the Crane Company’s election, such maximum ratio may be increased to 4.00 to 1.00

for specified periods following our consummation of certain material acquisitions) and a minimum interest coverage ratio must be at least 3.00 to 1.00. The Credit Agreement also includes for customary events of default, including failure to pay

principal, interest or fees when due, failure to comply with covenants, any representation or warranty made by us or any of our material subsidiaries being false in any material respect, default under certain other material indebtedness, certain

insolvency or receivership events affecting us and our material subsidiaries, certain ERISA events, material judgments and a change in control, in each case, subject to cure periods and thresholds where customary.

Reportable Segments

For additional information on recent business

developments and other information about us and our business, please refer to the information set forth under the captions, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in Part II,

Item 7 of this report, as well as in Part II, Item 8 under Note 4, “Segment Information,” in the Notes to Combined Financial Statements for sales, operating profit and assets employed by each segment.

Aerospace & Electronics

The Aerospace & Electronics

segment supplies critical components and systems, including original equipment and aftermarket parts, primarily for the commercial aerospace, and the military aerospace, defense and space markets. The commercial market and military market

accounted for 57% and 43%, respectively, of total segment sales in 2022. Sales to original equipment manufacturers (“OEMs”) and aftermarket customers were 72% and 28%, respectively, in 2022.

We provide mission critical systems that require high reliability and high accuracy, such as pressure sensors for aircraft engine control, aircraft braking systems for

fighter jets, power conversion solutions for spacecraft and lubrication systems for the harshest and most hazardous environmental conditions. Crane has differentiated proprietary technology and know-how supporting many of the fundamental

technologies that are supporting solutions where we are often sole source in the areas where we compete, with a track record for performance, reliability and continued innovation. A&E’s integrated capabilities include the following:

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A&E has a solid long term growth profile driven by positions on market

leading platforms, recent new program wins and continued investment in technology readiness. The segment is also positioned to benefit from underlying market growth driven by increasing new commercial aircraft deliveries, air passenger travel

growth, defense investment, ongoing maintenance, repair and overhaul organizations (“MRO”) requirements and emerging applications in the space market, as well as a strong trend driving greater electrification for aerospace and defense

applications. Our unique position to drive sustained growth is driven by differentiated technology investment focused on high-growth market segments, including Low Earth Orbit satellite constellations, next-generation aircraft engines, advanced

ground and sea-based radar systems, as well as high-power and bi-directional power conversion for numerous emerging commercial and military applications, including more-electric and hybrid-electric ground vehicles and hybrid-electric and pure

electric-propulsion aircraft.

Facilities are located in the United States, Taiwan, and France.

Process Flow Technologies

The Process Flow Technologies segment is a

provider of highly engineered fluid handling equipment for mission critical applications that require high reliability. The segment is comprised of Process Valves and Related Products, Pumps and Systems and Commercial Valves.

Our portfolio strategically targets the higher growth and less cyclical chemical, general industrial, water and wastewater and pharmaceutical industries. We expect

these industries to be outsized growth segments of the market, driven by investment in sustainability and clean energy, aging infrastructure, tightening wastewater regulations and an aging population with a growing demand for healthcare.

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Crane has a strong track record of innovation and being a pioneer in the industry, “writing the book” on the

flow of fluids with Technical Paper 410, which is still used as a definitive authority on the topic for engineers, professionals and other practitioners. By focusing on accelerating the rate of innovation through R&D investment, we have driven

incremental market capture and significantly improved new product sales vitality to support long term profitable growth.

Engineered Materials

The Engineered Materials segment manufactures fiberglass-reinforced plastic (“FRP”) panels and coils, primarily for use in the manufacturing of recreational

vehicles (“RVs”), and in commercial and industrial buildings applications, with some additional applications including trailers and other transportation-related products. Engineered Materials sells the majority of its products directly to

RV, trailer, and truck manufacturers, and it uses distributors and retailers to serve the commercial and industrial construction markets. Manufacturing facilities are located in the United States.

Other Matters Relating to Our Business as a Whole

Competitive

Conditions

Our businesses participate in markets that are highly competitive. Because of the diversity of products manufactured and sold, our businesses

typically have a different set of competitors in each geographic area and end market in which they participate. Accordingly, it is not possible to estimate the number of competitors, or precise market share; however, we believe that we are a

principal competitor in most of our markets. Our primary basis of competition is providing high quality products, with technological differentiation, at competitive prices, with superior customer service and timely delivery.

Our products are sold into primary end markets which include aerospace, defense and space, process industries, non-residential and municipal construction, along with a

wide range of general industrial and certain consumer related end markets. As such, our revenues depend on numerous unpredictable factors, including changes in market demand, general economic conditions, customer capital spending, timing and amount

of contract awards and credit availability. Since our products are sold in such a wide variety of markets, we do not believe that we can reliably quantify or predict the potential effects of changes in any of the aforementioned factors. Our

engineering and product development activities are focused on improving existing products, customizing existing products for particular customer requirements, as well as the development of new products. We own numerous patents, trademarks,

copyrights, trade secrets and licenses to intellectual property, no one of which is of such importance that termination would materially affect our business. From time to time, however, we do engage in litigation to protect our intellectual

property.

Raw Materials

Our manufacturing operations employ a wide

variety of raw materials, including steel, copper, cast iron, electronic components, aluminum, plastics, and various petroleum-based products. We purchase raw materials from a large number of independent sources around the world. Although market

forces have at times, including in 2022, caused increases in the costs of key raw materials, there have been no raw materials shortages that have had a material adverse impact on our business. We believe that we will generally be able to obtain

adequate supplies of major raw material requirements or reasonable substitutes at acceptable costs. For a further discussion of risks related to raw materials, please refer to Item 1A. “Risk Factors.”

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Government Contracts

We

have agreements relating to the sale of products to government entities, primarily involving products in our Aerospace & Electronics and, to a lesser extent, our Process Flow Technologies segment. As a result, we are subject to various

statutes and regulations that apply to companies doing business with the government. The laws and regulations governing government contracts differ from those governing private contracts. For example, some government contracts require disclosure of

cost and pricing data and impose certain sourcing conditions that are not applicable to private contracts. Our failure to comply with these laws could result in suspension of these contracts, criminal or civil sanctions, administrative penalties and

fines or suspension or debarment from government contracting or subcontracting for a period of time. For a further discussion of risks related to compliance with government contracting requirements, please refer to Item 1A. “Risk

Factors.”

Environmental Compliance and Climate Change

We are

regulated by federal, state and international environmental laws governing our use, transport and disposal of substances and control of emissions. Our manufacturing facilities generally do not produce significant volumes or quantities of byproducts

that would be considered hazardous waste or otherwise harmful to the environment if not properly handled or maintained. Accordingly, continued compliance with these existing laws has not had a material impact on our capital expenditures or earnings.

However, we occasionally engage in environmental remediation activities as required by federal and state laws. In addition, we may be exposed to other

environmental costs including participation in the characterization and remediation of federal Superfund sites, or analogous state sites. When it is reasonably probable we will pay remediation costs at a site, and those costs can be reasonably

estimated, we accrue a liability for such future costs with a related charge against our earnings. For further discussion of environmental related risks, please refer to Item 1A. “Risk Factors.” For further discussion of our

environmental matters, please refer to Part II, Item 8 under Note 13, “Commitments and Contingencies,” in the Notes to Combined Financial Statements.

Human Capital Resources

To remain a leading manufacturer of highly

engineered industrial products, it is important that we continue to attract, develop, and retain exceptional talent across our global enterprise.

The Company has a

diverse global workforce located in 20 countries, spanning six continents. At December 31, 2022, we employed approximately 7,000 persons worldwide, of which substantially all were full time employees. In the United States, we employed

approximately 4,000 people across 35 locations. At December 31, 2022, approximately 5% of our U.S. employees were represented by a union under a collective bargaining agreement. Employees based in some foreign countries may, from time to time,

be represented by works councils or unions or subject to collective bargaining agreements. We consider our relations with our employees to be good.

To be an

employer of choice and maintain the strength of our workforce, we consistently assess the current business environment and labor market to refine our compensation and benefits programs and other resources available to our associates. We are

committed to developing our associates personally and professionally by leveraging a structured and disciplined Intellectual Capital (“IC”) process. Our regular IC cadence includes constructive reviews and various talent and leadership

development initiatives conducted by the executive management team and provided throughout an associate’s career. We are also committed to an inclusive and high-performance culture at all levels of the organization, based on trust and respect.

The manufacture and production of our products requires the use of a variety of tools, equipment, materials, and supplies. At Crane, we are strongly committed to

the health and safety of our associates and strive to continuously adhere to global regulatory safety requirements and to reduce the incidence and severity of job-related injuries. We utilize strict compliance protocols, training programs, effective

risk management practices, and sound science in our operations to minimize risk to our associates.

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Beginning in 2020, in response to the COVID-19 pandemic, we implemented flexible remote work options and health and

safety protocols and procedures across all of our global offices, manufacturing and distribution facilities to ensure the safety and well-being of our associates. These protocols included proper hygiene, social distancing, mask use and temperature

screenings and other health and safety standards as required by federal, state and local government agencies, taking into consideration guidelines of the Centers for Disease Control and Prevention in the U.S., and other similar public health

authorities in our international locations. Today, we continue to deploy various work options and protocols in response to the significantly reduced health risks compared to the initial and early period of the pandemic.

For a discussion of risks related to employee relations, please refer to Item 1A. “Risk Factors.”

Available Information

We, and our sole shareholder, Crane Holdings, Co.,

each file annual, quarterly, and current reports and amendments to these reports, proxy statements and other information with the U.S. Securities and Exchange Commission (“SEC”). The SEC maintains an Internet site that contains reports,

proxy and information statements and other information regarding issuers, like us, that file electronically with the SEC. The address of the SEC’s website is www.sec.gov.

We, and Crane Holdings, Co., each also make our filings available free of charge through our Internet website, as soon as reasonably practicable after filing such

material electronically with, or furnishing such material, to the SEC. Also posted on our website are Crane Holdings, Co.’s Corporate Governance Guidelines, Standards for Director Independence, Crane Holdings, Co. Code of Ethics and the

charters and a brief description of each of Crane Holdings, Co.’s Audit Committee, Management Organization and Compensation Committee and Nominating and Governance Committee. These items are available in the “Investors – Corporate

Governance” section of Crane Holdings, Co.’s website at www.craneco.com. The content of this website is not part of this report.

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Item 1A. Risk Factors

Our business, financial condition, results of operations and cash flows may be affected by a number of factors including, but not limited to those set forth below. This

discussion should be considered in conjunction with the discussion under the caption “Forward-Looking Information” preceding Part I, the information set forth under Item 1, “Business” and with the discussion of the business

included in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These risks comprise the material risks of which we are aware. If any of the events or developments described

below or elsewhere in this Annual Report on Form 10-K, or in any documents that we subsequently file publicly were to occur, it could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Risks Relating to Our Business

Macroeconomic fluctuations may harm our

business, results of operations and stock price.

Our business, financial condition, operating results and cash flows may be adversely affected by changes

in global economic conditions and geopolitical risks, including credit market conditions, trade policies, levels of consumer and business confidence, commodity prices and availability, inflationary pressures, exchange rates, levels of government

spending and deficits, political conditions, and other challenges that could affect the global economy including impacts associated with any economic sanctions imposed against Russia, including any territory within the Ukraine that Russia has

occupied, in response to their invasion of the Ukraine. These economic and geopolitical conditions could affect businesses such as ours in a number of ways. Such conditions could have an adverse impact on our flexibility to react to changing

economic and business conditions and on our ability to fund our operations, grow through operations or refinance maturing debt balances at economically favorable interest rates. In addition, restrictions on credit availability could adversely affect

the ability of our customers to obtain financing for significant purchases and could result in decreases in or cancellation of orders for our products and services as well as impact the ability of our customers to make payments. Similarly, credit

restrictions may adversely affect our supplier base and increase the potential for one or more of our suppliers to experience financial distress or bankruptcy. See “Specific Risks Related to Our Business Segments.”

Our ability to source components and raw materials from our suppliers could be disrupted or delayed in our supply chain which could adversely affect our

results of operations.

Our operations require significant amounts of necessary components and raw materials. We deploy a continuous, company-wide

process to source our components and raw materials from fewer suppliers, and to obtain parts from suppliers in low-cost countries where possible. Due to a variety of global factors, our business has been experiencing, and may continue to experience,

supply chain disruptions from an insufficient availability of certain components and raw materials and substantial freight delays in obtaining them. If we are unable to timely source these components or raw materials, our operations may be

disrupted, or we could experience a delay or temporary stoppage in certain of our manufacturing operations. We believe that our supply management and production practices are based on an appropriate balancing of the foreseeable risks and the costs

of alternative practices. Nonetheless, reduced availability or interruption in supplies, whether resulting from more stringent regulatory requirements; supplier financial condition; increases in duties and tariff costs; disruptions in

transportation; an outbreak of a severe public health pandemic, such as the COVID-19 pandemic; severe weather; the occurrence or threat of wars, including Russia’s invasion of Ukraine or other conflicts, could have an adverse effect on our

financial condition, results of operations and cash flows.

The prices of our components and raw materials could fluctuate dramatically, which may adversely

affect our profitability.

The costs of certain components and raw materials that are critical to our profitability can be volatile which can have a

significant impact on our profitability. The costs in our business segments are affected by fluctuations in the price of metals such as steel and copper as well as other raw materials such as resin, and electronic components. We have seen a period

of sustained price increases for components and raw materials that may continue into the future as demand increases and supply may remain constrained, which has resulted in, and may continue to result in, increased costs for us. While we have taken

actions aimed at securing an adequate supply of raw materials at prices which are favorable to us, if the prices of critical components and raw materials continue to increase or we are unable to pass increased costs of components and raw materials

to customers, our operating profit could be adversely affected.

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The COVID-19 pandemic had and may continue to have an adverse impact on our operations and financial performance, as

well as on the operations and financial performance of many of the customers and suppliers in industries that we serve. The COVID-19 pandemic continues to present business challenges, and we continue to experience impacts related to COVID-19,

primarily in disruptions in global supply chains, delays in supplier deliveries, higher raw material prices, delays in deliveries to customers, travel restrictions, site access and quarantine restrictions, and employee absences. Because the

severity, magnitude and duration of the COVID-19 pandemic and its continuing economic consequences remain uncertain and rapidly changing, it is difficult to predict the extent of the pandemic’s impact on our operations and financial

performance.

Information systems and technology networks failures and breaches in data security, personally identifiable and other information,

non-compliance with our contractual or other legal obligations regarding such information, or a violation of our privacy and security policies with respect to such information, could adversely affect us.

We are dependent on information technology networks and systems, including the Internet, to process, transmit and store electronic information, and, in the normal

course of our business, we collect and retain certain types of personally identifiable and other information pertaining to our customers, stockholders and employees. The legal, regulatory and contractual environment surrounding information security

and privacy is constantly evolving and companies that collect and retain such information are under increasing attack by cyber-criminals around the world. A theft, loss, fraudulent use or misuse of customer, vendor, employee or our proprietary data

by cybercrime or otherwise, non-compliance with our contractual or other legal obligations regarding such data or a violation of our privacy and security policies with respect to such data could adversely impact our reputation and could result in

costs, fines, litigation or regulatory action against us. Security breaches can create system disruptions and shutdowns that could result in disruptions to our operations. We cannot be certain that advances in criminal capabilities, new

vulnerabilities or other developments will not compromise or breach the security solutions protecting our information technology, networks and systems. A cyber-attack on our information systems technology or those of our partners, vendors, suppliers

could adversely affect our ability to process orders, maintain proper levels of inventory, collect accounts receivable and pay expenses; all of which could have an adverse effect on our results of operations, financial condition and cash flows.

Failure to effectively prevent, detect and recover from security breaches, including attacks on information technology and infrastructure by hackers; viruses; breaches due to employee error or actions; or other disruptions could seriously harm our

operations as well as the operations of our customers and suppliers. Such serious harm can involve, among other things, misuse of our assets, business disruptions, loss of data, unauthorized access to trade secrets and confidential business

information, unauthorized access to personal information, legal claims or proceedings, reporting errors, processing inefficiencies, negative media attention, reputational harm, loss of sales, remediation and increased insurance costs, and

interference with regulatory compliance. We have experienced and expect to continue to experience some of these types of cybersecurity threats and incidents, which could be material in the future.

Demand for our products is variable and subject to factors beyond our control, which could result in unanticipated events significantly impacting our results of

operations.

A substantial portion of our sales is concentrated in industries that are cyclical in nature or subject to market conditions which may cause

customer demand for our products to be volatile. Reductions in demand by these industries would reduce the sales and profitability of the affected business segments.

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Our businesses are subject to extensive governmental regulation; failure to comply with those regulations could adversely affect our financial condition, results

of operations, cash flows and reputation.

We are required to comply with various import and export control laws, which may affect our transactions with

certain customers, particularly in our Aerospace & Electronics and Process Flow Technologies segments, as discussed more fully under “Specific Risks Relating to Our Business Segments.” In certain circumstances, export control and

economic sanctions, and other trade-related regulations may prohibit the export of certain products, services and technologies, and in other circumstances we may be required to obtain an export license before exporting the controlled item. A failure

to comply with these requirements might result in suspension of these contracts and suspension or debarment from government contracting or subcontracting. For example, compliance with regulations related to the sourcing of conflict-free minerals

mined from the democratic Republic of Congo and adjoining countries could limit the pool of suppliers who can provide conflict-free minerals to us, and as a result, may cause us to incur additional expenses and may create challenges for us to obtain

conflict-free minerals at competitive prices. In addition, we are subject to the Foreign Corrupt Practices Act, which prohibits U.S. companies and their intermediaries from making improper payments to foreign officials for the purpose of obtaining

or retaining business, or securing any improper advantage. We are also subject to the anti-bribery laws of other jurisdictions. Failure to comply with any of these and similar regulations could result in civil and criminal liability, monetary and

non-monetary penalties, fines, disruptions to our business, limitations on our ability to export products and services, and damage to our reputation.

We

compete with other manufacturing businesses for highly qualified employees in the countries in which we operate, and we may not be able to retain our personnel or hire and retain additional personnel needed for us to sustain and grow our business as

planned.

Our business segments and corporate offices are dependent upon highly qualified personnel, and we generally are dependent upon the continued

efforts of key management employees. A number of factors may adversely affect the labor force available to us or increase labor costs, including high employment levels, federal unemployment subsidies, including enhanced or expanded unemployment

benefits offered in response to the ongoing COVID-19 pandemic, and other government regulations. We have recently observed an overall tightening and increasingly competitive labor market which has, and could continue to result in higher compensation

costs. While we believe we have a robust intellectual capital process, we may have difficulty retaining key personnel or locating and hiring additional qualified personnel. The loss of the services of any of such personnel or our failure to attract

and retain other qualified and experienced personnel on acceptable terms could impair our ability to successfully sustain and grow our business, which could have an adverse effect on our results of operations and financial condition.

We conduct a substantial portion of our business outside the U.S. and face risks inherent in non-domestic operations.

Net sales by destination outside the U.S. were 42.2% of our combined amounts in 2022. We expect that non-U.S. sales will continue to account for a significant portion

of our revenues for the foreseeable future. In addition, our operations outside the U.S. are subject to the risks associated with conducting business internationally, including, but not limited to:

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Net periodic pension (benefit) cost and pension contributions associated with our retirement benefit plans may fluctuate significantly

depending upon changes in actuarial assumptions and future market performance of plan assets.

Total net periodic pension benefit and pension contributions

were $2.3 million and $17.8 million, respectively in 2022. The costs of our defined benefit pension plans are dependent upon various factors, including rates of return on investment assets, discount rates for future payment obligations, and expected

mortality, among other things. In addition, funding requirements for benefit obligations of our pension plans are subject to legislative and other government regulatory actions. Variances in related estimates could have an adverse effect on our

financial condition, results of operations and cash flows.

Our business could be harmed if we are unable to protect our intellectual property.

We rely on a combination of trade secrets, patents, trademarks, copyrights and confidentiality procedures to protect our products and technology. Existing trade secret,

patent, trademark and copyright laws offer only limited protection. Our patents could be invalidated or circumvented. In addition, others may develop substantially equivalent, or superseding proprietary technology, or competitors may offer

equivalent non-infringing products in competition with our products, thereby substantially reducing the value of our proprietary rights. The laws of some foreign countries in which our products are or may be manufactured or sold may not protect our

products or intellectual property rights to the same extent as do the laws of the U.S. We cannot assure that the steps we take to protect our intellectual property will be adequate to prevent misappropriation of our technology. We could incur

significant and/or unexpected costs in our efforts to successfully avoid, manage, defend and litigate intellectual property matters. Our inability to protect our intellectual property could have an adverse effect on our financial condition, results

of operations and cash flows.

We may be unable to identify or to complete acquisitions, or to successfully integrate the businesses we acquire.

We have evaluated, and expect to continue to evaluate, a wide array of potential acquisition transactions. Our acquisition program attempts to address the potential

risks inherent in assessing the value, strengths, weaknesses, contingent or other liabilities, systems of internal control and potential profitability of acquisition candidates, as well as other challenges such as retaining the employees and

integrating the operations of the businesses we acquire. Integrating acquired operations involves significant risks and uncertainties, including:

• Maintenance of uniform standards, controls, policies and procedures;

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• Unplanned expenses associated with the integration efforts;

There can be no assurance that suitable acquisition opportunities will be available in the future, that we will continue to acquire businesses or that any business

acquired will be integrated successfully or prove profitable, which could adversely impact our growth rate. Our ability to achieve our growth goals depends in part upon our ability to identify and successfully acquire, finance and integrate

companies and businesses at appropriate prices and realize anticipated cost savings.

Our future results of operations and financial condition could be

adversely impacted by intangible asset impairment charges.

As of December 31, 2022, we had goodwill and other intangible assets, net of accumulated

amortization, of $762.6 million, which represented approximately 34% of our total assets. Our goodwill is subject to an impairment test on an annual basis and is also tested whenever events and circumstances indicate that goodwill may be impaired.

Any excess goodwill resulting from the impairment test must be written off in the period of determination. Intangible assets (other than goodwill) are generally amortized over the useful life of such assets. In addition, from time to time, we may

acquire or make an investment in a business that will require us to record goodwill based on the purchase price and the value of the acquired assets. We may subsequently experience unforeseen issues with such business that adversely affect the

anticipated returns of the business or value of the intangible assets and trigger an evaluation of the recoverability of the recorded goodwill and intangible assets for such business. Future determinations of significant write-offs of goodwill or

intangible assets as a result of an impairment test or any accelerated amortization of other intangible assets could have an adverse effect on our financial condition and results of operations.

Our operations expose us to the risk of environmental liabilities, costs, litigation and violations that could adversely affect our financial condition, results

of operations, cash flows and reputation.

Our operations are subject to extensive environmental and health and safety laws and regulations in the

jurisdictions in which they operate, which impose limitations on the discharge of pollutants into the ground, air and water and establish standards for the generation, treatment, use, storage and disposal of solid and hazardous wastes. We must also

comply with various health and safety regulations in the U.S. and abroad in connection with our operations. The costs of compliance with these regulations results in ongoing costs that may increase over time. Failure to comply with any of these laws

could result in civil and criminal liability, substantial monetary and non-monetary penalties and damage to our reputation. In addition, we cannot provide assurance that our costs related to remedial efforts or alleged environmental damage

associated with past or current waste disposal practices or other hazardous materials handling practices will not exceed our estimates or adversely affect our financial condition, results of operations and cash flows.

We may be unable to improve productivity, reduce costs and align manufacturing capacity with customer demand.

We are committed to continuous productivity improvement, and we continue to evaluate opportunities to reduce costs, simplify or improve global processes, and increase

the reliability of order fulfillment and satisfaction of customer needs. In order to operate more efficiently and control costs, from time to time we execute restructuring activities, which include workforce reductions and facility consolidations.

For example, we recorded pre-tax restructuring charges of $32.1 million for the 2020 repositioning program related to actions to reduce our global workforce in response to the adverse economic impact of COVID-19. At the end of 2022, we took modest

cost reduction actions in response to continued global economic uncertainty. While these are proactive actions to increase our productivity and operating effectiveness, our inability to adequately respond to potential declines in global demand for

our products and services and properly align our cost base could have an adverse effect on our financial condition, results of operations and cash flows.

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We could face potential product liability or warranty claims, we may not accurately estimate costs related to

such claims, and we may not have sufficient insurance coverage available to cover such claims.

Our products are used in a wide variety of commercial

applications and certain residential applications, including, in many cases, in severe service or mission critical applications. We face an inherent business risk of exposure to product liability or other claims in the event our products are alleged

to be defective or that the use of our products is alleged to have resulted in harm to others or to property. We may in the future incur liability if product liability lawsuits against us are successful. Moreover, any such lawsuits, whether or not

successful, could result in adverse publicity to us, which could cause our sales to decline.

In addition, consistent with industry practice, we provide warranties

on many of our products and we may experience costs of warranty or breach of contract claims if our products have defects in manufacture or design or they do not meet contractual specifications. We estimate our future warranty costs based on

historical trends and product sales, but we may fail to accurately estimate those costs and thereby fail to establish adequate warranty reserves for them.

While we

maintain insurance coverage with respect to certain liability claims, that insurance coverage may not be adequate to cover all claims that may arise or we may not be able to maintain adequate insurance coverage in the future at an acceptable cost.

Any liabilities not covered by insurance or that exceed our established reserves could have an adverse effect on our financial condition, results of operations and cash flows.

We may be unable to successfully develop and introduce new products, which would limit our ability to grow and maintain our competitive position and adversely

affect our financial condition, results of operations and cash flow.

Our growth depends, in part, on continued sales of existing products, as well as the

successful development and introduction of new products or technologies, which face the uncertainty of customer acceptance and reaction from competitors. Any delay in the development or launch of a new product could result in our not being the first

to market, which could compromise our competitive position. Further, the development and introduction of new products may require us to make investments in specialized personnel and capital equipment, increase marketing efforts and reallocate

resources away from other uses. We also may need to modify our systems and strategy in light of new products that we develop. If we are unable to develop and introduce new products in a cost-effective manner or otherwise manage effectively the

operations related to new products, our financial condition, results of operations and cash flows could be adversely impacted.

We face significant

competition which may adversely impact our financial condition, results of operations, and cash flows in the future.

While we are a principal competitor in

most of our markets, all of our markets are highly competitive. The competitors in many of our business segments can be expected in the future to improve technologies, reduce costs and develop and introduce new products. The ability of our business

segments to achieve similar advances will be important to our competitive positions. Competitive pressures, including those discussed above, could cause one or more of our business segments to lose market share or could result in significant price

erosion, either of which could have an adverse effect on our financial condition, results of operations and cash flows.

Fluctuations in interest rates could

affect our financial results.

A portion of our indebtedness bears interest at variable rates that are linked to changing market interest rates. As a

result, an increase in market interest rates would increase our interest expense and our debt service obligations. As of December 31, 2022, we had approximately $400.0 million of indebtedness that bears interest at variable rates. As of

December 31, 2022, a hypothetical 1% increase in prevailing interest rates would increase our 2022 interest expense by approximately $4.0 million.

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Additional tax expense or exposures could affect our financial condition, results of operations and cash

flows.

We are subject to income taxes in the U.S. and various international jurisdictions. Our financial condition, results of operations and cash flow

could be affected by changes to any or all of the following: tax laws, regulations, accounting principles and judicial rulings, the geographic mix of our earnings, the valuation of our deferred tax assets and liabilities, and the results of audits

and examinations of previously filed tax returns.

If our internal controls are found to be ineffective, our financial results or our stock price may be

adversely affected.

We believe that we currently have adequate internal control procedures in place for future periods, including processes related to

newly acquired businesses; however, increased risk of internal control breakdowns generally exists in any business environment that is decentralized such as ours. In addition, if our internal control over financial reporting is found to be

ineffective, investors may lose confidence in the reliability of our financial statements, which may adversely affect our stock price.

Specific Risks Relating

to Our Reportable Segments

Aerospace & Electronics

Our Aerospace & Electronics segment sales are primarily affected by conditions in the commercial aerospace industry which is cyclical in nature, and by changes

in defense spending by the U.S. government.

Commercial aircraft are procured primarily by airlines, and airline capital spending can be affected by a number of

factors including credit availability and related cost, current and expected fuel prices, and current and forecast air traffic demand levels. Air traffic levels are affected by a different array of factors including general economic conditions and

global corporate travel spending, although other non-economic events can also adversely impact airline traffic, including terrorism or pandemic health concerns, such as the COVID-19 pandemic. Our commercial business is also affected by the market

for business jets where demand is typically tied to corporate profitability levels, and the freight markets which are most heavily influenced by general economic conditions. Demand for our commercial aftermarket business is closely tied to total

aircraft flight hours. Any decrease in demand for new aircraft or equipment, or use of existing aircraft and equipment, would likely result in decreased sales of our products and services. In addition, our commercial business could also be impacted

to the extent that our major aircraft manufacturing customers encounter problems which impact their production rates and, correspondingly, reduce purchases of our products (for example, the grounding of the 737 MAX and associated suspension of 737

MAX production announced by Boeing in December 2019 reduced our sales and operating profit in 2020), or if pricing pressure from aircraft customers caused the manufacturers to press their suppliers to lower prices and/or extend payment terms.

The defense portion of the segment’s business is dependent primarily on U.S. government spending, and to a lesser extent, foreign government spending, on the

specific military platforms and programs where our business participates. Any reduction in appropriations for these platforms or programs could impact the performance of our business. Our sales to defense customers are also affected by the level of

activity in military flight operations.

We rely on certain subcontractors and suppliers to provide and produce raw materials, integrated components and

sub-assemblies. The Aerospace and Defense industry is experiencing continued disruptions due to the lingering impacts of COVID-19, global supply chain constraints, and labor instability. If one or more of our suppliers or subcontractors continue to

experience delivery delays or other performance problems, we may be unable to meet commitments to our customers and our financial position, results of operations and cash flows may continue to be adversely impacted. In some instances, we depend upon

a single source of supply. Any service disruption from one of these suppliers, either due to circumstances beyond the supplier’s control, such as geopolitical developments, could have a material adverse effect on our ability to meet commitments

to our customers or increase our operating costs.

We are required to comply with various export control laws, which may affect our transactions with certain

customers. In certain circumstances, export control and economic sanctions regulations may prohibit the export of certain products, services and technologies, and in other circumstances we may be required to obtain an export license before exporting

the controlled item. We are also subject to investigation and audit for compliance with the requirements governing government contracts,

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including requirements related to procurement integrity, manufacturing practices and quality procedures, export control, employment practices, the accuracy of records and the recording of costs

and information security requirements. A failure to comply with these requirements could result in suspension of these contracts, and suspension or debarment from government contracting or subcontracting. Failure to comply with any of these

regulations could result in civil and criminal liability, monetary and non-monetary penalties, fines, disruptions to our business, limitations on our ability to export products and services, and damage to our reputation.

Due to the lengthy research and development cycle involved in bringing commercial and military products to market, we cannot accurately predict the demand levels that

will exist once a given new product is ready for market. In addition, if we are unable to develop and introduce new products in a cost-effective manner or otherwise effectively manage the introduction of new products and/or programs, our results of

operations and financial condition could be adversely impacted. Demand for our products could also be adversely impacted by industry consolidation that could result in greater acceptance of competitors’ products.

Process Flow Technologies

Our Process Flow Technologies segment

competes in markets that are fragmented and highly competitive. The business competes against large, well established global companies, as well as smaller regional and local companies. We compete based on our products’ quality, reliability and

safety, our brand reputation, value-added technical expertise and customer support and consistent on-time delivery.

Demand for our Process Flow Technologies

products is heavily dependent on our customers’ level of new capital investment and planned maintenance expenditures. Customer spending typically depends on general economic conditions, availability of credit, and expectations of future demand.

Slowing global economic growth, volatility in commodity prices, including the price of oil could all contribute to lower levels of customer spending, and project delays or cancellations.

A portion of this segment’s business is subject to government contracting rules and regulations. Failure to comply with these requirements could result in

suspension or debarment from government contracting or subcontracting, civil and criminal liability, monetary and non-monetary penalties, disruptions to our business, limitations on our ability to export products and services, or damage to our

reputation. At our foreign operations, results could also be adversely impacted by a weakening of local currencies against the U.S. dollar. Our Process Flow Technologies business has the greatest exposure to the euro, British pound and Canadian

dollar, and lesser exposure to several other currencies.

Engineered Materials

Our Engineered Materials segment manufactures and sells fiberglass reinforced plastic (“FRP”) panels and coils, primarily for use in the manufacturing of RVs,

trucks, and trailers, with additional applications in commercial and industrial building construction. Demand in these end markets is dependent on general economic conditions, credit availability, and consumer and corporate spending levels. A

decline in demand in any of these end markets, including a significant change in RV industry capacity; a loss of market share to alternative materials such as, for example, non-reinforced plastic, PVC, tile, stainless steel, epoxy paint, wood, and

aluminum; or customer pricing pressure would result in lower sales and profits for this business. Profitability could also be adversely affected by an increase in the price of resin or fiberglass if we are unable to pass the incremental costs on to

our customers. Additional risks include the loss of a principal supplier.

Risks Related to the Spin-Off

Crane Company may not achieve some or all of the expected benefits of the spin-off, and the spin-off may adversely affect the Company’s business.

Crane Company may not be able to achieve the full strategic and financial benefits expected to result from the spin-off, or such benefits may be delayed or not occur at

all. The spin-off is expected to provide the following benefits, among others:

Crane Company may not achieve these and other anticipated benefits for a variety of reasons, including, among

others: (i) the spin-off will require significant amounts of management’s time and effort, which may divert management’s attention from operating and growing Crane Company’s business, (ii) following the spin-off, Crane Company’s

stock price may be more susceptible to market fluctuations and other events particular to one or more of Crane Company’s products than if it were still a part of Crane and (iii) following the spin-off, Crane Company’s operational and

financial profile will change such that Crane Company’s diversification of revenue sources will diminish, and Crane Company’s results of operations, cash flows, working capital and financing requirements may be subject to increased

volatility than prior to the spin-off. Additionally, Crane Company may experience unanticipated competitive developments, including changes in the conditions of the markets of the Company’s A&E, PFT and Engineered Materials segments, and

the other businesses it will hold at the time of the spin-off, that could negate the expected benefits from the spin-off. If Crane Company does not realize some or all of the benefits expected to result from the spin-off, or if such benefits are

delayed, the business, financial condition, results of operations and cash flows of Crane Company could be adversely affected.

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Crane Company may incur material costs and expenses as a result of the spin-off.

Crane Company may incur costs and expenses greater than those Crane Company currently expects to incur as a result of the spin-off. These increased costs and expenses

may arise from various factors, including financial reporting and costs associated with complying with federal securities laws (including compliance with the Sarbanes-Oxley Act). In addition, Crane Company expects to either maintain similar or have

increased corporate and administrative costs and expenses to those Crane Company incurred while part of Crane, even though, following the spin-off, Crane Company will be a smaller, stand-alone company. We cannot assure you that these costs will not

be material to Crane Company’s business.

If, following the spin-off, Crane Company is unable to satisfy the requirements of Section 404 of the

Sarbanes-Oxley Act, or its internal control over financial reporting is not effective, it could have a material adverse effect on the Company’s businesses and Crane Company’s stock price may suffer.

Section 404 of the Sarbanes-Oxley Act requires any company subject to the reporting requirements of the U.S. securities laws to do a comprehensive evaluation of its and

its consolidated subsidiaries’ internal control over financial reporting. Our financial results previously were included within the consolidated results of Crane. However, Crane Company was not directly subject to the reporting and other

requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or the Sarbanes-Oxley Act.

As a result of the spin-off, Crane

Company will be directly subject to reporting and other obligations under the Exchange Act. Beginning with its second annual report on Form 10-K, Crane Company will be required to comply with Section 404 of the Sarbanes-Oxley Act which will require

it to document and test its internal control procedures, its management will be required to assess and issue a report concerning its internal control over financial reporting and its independent auditors will be required to issue an opinion on Crane

Company’s internal controls over financial reporting. These reporting and other obligations may place significant demands on our management and administrative and operational resources, including accounting systems and resources. To comply with

these requirements, we will need to establish our own systems, implement additional financial and management controls, reporting systems and procedures and hire additional accounting and finance staff. We expect to incur additional annual expenses

for the purpose of addressing these requirements, and those expenses may be significant. If we are unable to establish our financial and management controls, reporting systems, information technology systems and procedures in a timely and effective

fashion, our ability to comply with our financial reporting requirements and other rules that apply to reporting companies under the Exchange Act could be impaired.

During periods it is required to assess the effectiveness of its internal controls, if Crane Company’s management is unable to conclude that it has effective

internal controls over financial reporting or its independent public accounting firm is unwilling or unable to provide Crane Company with an unqualified report on the effectiveness of its internal controls, as required by Section 404 of the

Sarbanes-Oxley Act, Crane Company may not be able to report its financial information on a timely basis. As a result, investors may lose confidence in Crane Company’s financial results, Crane Company’s stock price may suffer and Crane

Company may be subject to litigation or regulatory enforcement actions, any of which could have a material adverse effect on the Company’s businesses.

The historical and pro forma financial information presented herein is not necessarily representative of the results that Crane Company would have achieved as a

separate, publicly traded company and therefore may not be a reliable indicator of its future results.

Due to Crane Company’s larger operations,

greater tangible assets, greater fair value and greater net sales, in each case, relative to Crane NXT, among other factors, Crane Company will be treated as the “accounting spinnor” and therefore will be the “accounting

successor” to Crane for accounting purposes, notwithstanding the legal form of the spin-off described in this Annual Report on Form 10-K. Therefore, following the spin-off, the historical consolidated financial statements of Crane will

represent the historical financial statements of Crane Company and Crane NXT will be presented as discontinued operations. The historical information about the Company in this Annual Report on Form 10-K refers to the Company’s businesses as

part of Crane. The Company’s historical and pro forma financial information included in this Annual Report on Form 10-K is derived from the consolidated financial statements and accounting records of Crane. Accordingly, the historical and pro

forma financial information included in this Annual Report on Form 10-K does not necessarily reflect the financial condition, results of operations or cash flows that Crane Company would have achieved as a separate, publicly traded company during

the periods presented or those that Crane Company will achieve in the future.

For additional information about the past financial performance of Crane

Company’s businesses and the basis of presentation of the historical consolidated financial statements of Crane, the supplemental historical combined financial statements of Crane Company, see Item 8 of this Annual Report on Form 10-K.

Crane NXT, Co. may fail to perform under various transaction agreements that will be executed as part of the spin-off or Crane Company may fail to have

necessary systems and services in place when Crane NXT, Co. is no longer obligated to provide services under the various agreements.

Crane Company and Crane

Holdings, Co. or Crane NXT, Co., as applicable, will enter into certain agreements, such as the separation and distribution agreement, a transition services agreement, a tax matters agreement, an intellectual property

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matters agreement and an employee matters agreement, and those other agreements discussed in greater detail in Item 13 “Certain Relationships and Related Party

Transactions—Agreements with Crane Holdings, Co. / Crane NXT, Co.” of this Annual Report on Form 10-K, which may provide for the performance by each company for the benefit of the other for a period of time after the spin-off. If

Crane NXT, Co. is unable to satisfy its obligations under these agreements, including its indemnification obligations, Crane Company could incur operational difficulties or losses.

If Crane Company does not have in place its own systems and services, and does not have agreements with other providers of these services when the transitional or other

agreements terminate, or if Crane Company does not implement the new systems or replace Crane NXT, Co.’s services successfully, Crane Company may not be able to operate its business effectively, which could disrupt its business and have a

material adverse effect on its business, financial condition and results of operations. These systems and services may also be more expensive to install, implement and operate, or less efficient than the systems and services Crane NXT, Co. is

expected to provide during the transition period.

Potential indemnification liabilities to Crane NXT, Co. pursuant to the separation and distribution

agreement could materially and adversely affect Crane Company’s business, financial condition, results of operations and cash flows.

The separation and

distribution agreement, among other things, will provide for indemnification obligations designed to make Crane Company financially responsible for certain liabilities that may exist relating to its business activities. If Crane Company is required

to indemnify Crane NXT, Co. under the circumstances set forth in the separation and distribution agreement, Crane Company may be subject to substantial liabilities.

Crane Company may be subject to certain contingent liabilities of Crane NXT following the spin-off.

After the spin-off, there is the possibility that certain liabilities of Crane NXT could become Crane Company obligations. For example, under the Code and the related

rules and regulations, each corporation that was a member of Crane during a taxable period or portion of a taxable period ending on or before the effective time of the distribution is jointly and severally liable for the United States federal income

tax liability of Crane for that taxable period. Consequently, if Crane NXT is unable to pay the consolidated United States federal income tax liability for a prior period, Crane Company could be required to pay the entire amount of such tax, which

could be substantial and in excess of the amount that would be allocated to it under the tax matters agreement that Crane Company intends to enter into with Crane Holdings, Co., which will be renamed “Crane NXT, Co.” For a discussion of

the tax matters agreement, see Item 13 “Certain Relationships and Related Party Transactions—Agreements with Crane Holdings, Co. / Crane NXT, Co.—Tax Matters Agreement” of this Annual Report on Form 10-K; other provisions of

federal law establish similar liability for other matters, including laws governing tax-qualified pension plans, as well as other contingent liabilities.

In

connection with Crane Company’s spin-off from Crane, Crane NXT, Co. will indemnify Crane Company for certain liabilities. However, there can be no assurance that the indemnity will be sufficient to insure Crane Company against the full amount

of such liabilities, or that Crane Company’s ability to satisfy its indemnification obligation will not be impaired in the future.

Crane NXT, Co. will

agree to indemnify Crane Company for certain pre-spin-off liabilities as discussed further in Item 13 “Certain Relationships and Related Party Transactions—Agreements with Crane Holdings, Co. / Crane NXT, Co.” of this Annual Report on

Form 10-K. However, third parties could also seek to hold Crane Company responsible for liabilities that Crane NXT, Co. has agreed to retain, and there can be no assurance that the indemnity from Crane NXT, Co. will be sufficient to protect

Crane Company against the full amount of such liabilities, or that Crane NXT, Co. will be able to fully satisfy its indemnification obligations. In addition, Crane NXT, Co.’s insurers may attempt to deny coverage to Crane Company for

liabilities associated with certain occurrences of indemnified liabilities prior to the spin-off.

If the distribution of shares of Crane Company, together

with certain related transactions, does not qualify for the intended tax treatment, you and Crane NXT, Co. could be subject to significant U.S. federal income tax liability and, in certain circumstances, Crane Company could be required to indemnify

Crane NXT for material taxes pursuant to indemnification obligations under the anticipated tax matters agreement.

Crane Holdings, Co. has received the IRS

Ruling on certain issues relevant to the qualification of the distribution under sections 368(a)(1)(D) and 355 of the Code, based on certain facts and representations set forth in such request. The IRS Ruling does not address all of the requirements

relevant to the qualification of the distribution for the intended tax treatment.

It is a condition to the completion of the distribution that Crane Holdings, Co.

receives the Tax Opinion (unless waived by Crane Holdings, Co. in its sole discretion). The Tax Opinion will rely on certain facts, assumptions, representations and undertakings from Crane Holdings, Co. and Crane Company, including those regarding

the past and future conduct of the companies’ respective businesses and other matters. Notwithstanding the Tax Opinion, the IRS could determine that the distribution or any such related transaction is taxable if it determines that any of these

facts, assumptions, representations or undertakings are not correct or have been violated, or that the distribution should be taxable for other reasons, including if the IRS were to disagree with the conclusions in the Tax Opinion.

If the distribution or any of the above referenced related transactions is determined to be taxable for U.S. federal income tax purposes, a stockholder of Crane

Holdings, Co. that has received shares of Crane Company common stock in the distribution and Crane NXT could each incur significant U.S. federal income tax liabilities. In addition, Crane NXT and we could incur significant U.S. federal income tax

obligations, whether under applicable law or under the tax matters agreement that Crane Company intends to enter into with Crane Holdings, Co.

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Crane Company may not be able to engage in certain corporate transactions after the spin-off.

Crane Company and Crane Holdings, Co., which will be renamed “Crane NXT, Co.”, intend to enter into a tax matters agreement immediately prior to the

distribution that will, in relevant part, generally govern Crane Company and Crane NXT, Co.’s respective rights, responsibilities and obligations with respect to tax liabilities and benefits.

The tax matters agreement is not anticipated to restrict us expressly from taking actions after the distribution that could adversely affect the intended U.S. federal

income tax treatment of the distribution, together with certain related transactions. Nevertheless, under the anticipated tax matters agreement, we may be required to indemnify Crane NXT, Co. against certain tax liabilities as a result of our

actions or the acquisition of our stock or assets, including in certain circumstances where such actions or acquisitions may be outside of our control. Our anticipated indemnity obligation to Crane NXT, Co. in the tax matters agreement is not

limited in amount. In addition, even if we are not responsible for tax liabilities of Crane NXT under the anticipated tax matters agreement, we nonetheless could potentially be liable under applicable tax law for such liabilities if Crane NXT were

to fail to pay such taxes.

Any anticipated indemnity obligation to Crane NXT, Co. in the tax matters agreement or under applicable tax law might discourage, delay

or prevent us from taking certain actions, particularly for the two years following the distribution, including (among other things) the ability to freely issue stock, to make acquisitions, to raise additional equity capital or to effect a change in

control that we or our stockholders may consider favorable. Such anticipated indemnity obligations may, furthermore, limit our ability to pursue certain strategic transactions or other transactions that it may believe to be in the best interests of

our stockholders or that might otherwise increase the value of our business.

For a discussion of the tax matters agreement, see Item 13 “Certain Relationships

and Related Party Transactions—Agreements with Crane Holdings, Co. / Crane NXT, Co.—Tax Matters Agreement” of this Annual Report on Form 10-K.

The spin-off and related internal restructuring transactions may expose Crane Company to potential liabilities arising out of state and federal fraudulent

conveyance laws and legal dividend requirements.

The spin-off could be challenged under various state and federal fraudulent conveyance laws. Fraudulent

conveyances or transfers are generally defined to include (i) transfers made or obligations incurred with the actual intent to hinder, delay or defraud current or future creditors or (ii) transfers made or obligations incurred for less than

reasonably equivalent value when the debtor was insolvent, or that rendered the debtor insolvent, inadequately capitalized or unable to pay its debts as they become due. A creditor or an entity acting on behalf of a creditor (including, without

limitation, a trustee or debtor-in-possession in a bankruptcy by Crane NXT, Co. or Crane Company or any of their respective subsidiaries) may bring a lawsuit alleging that the spin-off or any of the related transactions constituted a fraudulent

conveyance. If a court accepts these allegations, it could impose a number of remedies, including, without limitation, voiding the distribution and returning Crane Company’s assets or Crane Company’s shares and subjecting Crane NXT, Co.

and/or Crane Company to liability.

The distribution of Crane Company common stock is also subject to state corporate distribution statutes. Under Delaware General

Corporation Law (“DGCL”), a corporation may only pay dividends to its stockholders either (a) out of its surplus (net assets minus capital) or (b) if there is no such surplus, out of its net profits for the fiscal year in which the

dividend is declared and/or the preceding fiscal year. Although Crane Holdings, Co. intends to make the distribution of Crane Company common stock entirely out of surplus, Crane Company and Crane Holdings, Co. cannot ensure that a court would reach

the same conclusion in determining the availability of surplus for the separation and the distribution to Crane Holdings, Co.’s stockholders.

After the

spin-off, certain of Crane Company’s executive officers and directors may have actual or potential conflicts of interest because of their previous positions at Crane.

Because of their current or former positions with Crane, certain of Crane Company’s expected executive officers and directors own equity interests in Crane

Holdings, Co. Following the spin-off, even though Crane Company’s Board of Directors will consist of a majority of directors who are independent, and Crane Company’s expected executive officers who are currently employees of Crane will

cease to be employees of Crane NXT, Co. upon the spin-off, some of Crane Company’s executive officers and directors will continue to have a financial interest in shares of Crane NXT, Co. common stock. Continuing ownership of shares of Crane

NXT, Co. common stock and equity awards could create, or appear to create, potential conflicts of interest if the Company and Crane NXT pursue the same corporate opportunities or face decisions that could have different implications for the Company

and Crane NXT.

No vote of Crane Holdings, Co. stockholders is required in connection with the spin-off.

No vote of Crane Holdings, Co. stockholders is required in connection with the spin-off. Accordingly, if this transaction occurs and you do not want to receive Crane

Company common stock in the distribution, your only recourse will be to divest yourself of your Crane Holdings, Co. common stock prior to the record date for the distribution or to sell your Crane Holdings, Co. common stock in the

“regular-way” market in between the record date and the distribution date.

Crane Company may have received better terms from unaffiliated third

parties than the terms it will receive in its agreements with Crane Holdings, Co.

The agreements Crane Company will enter into with Crane Holdings, Co. or

Crane NXT, Co., as applicable, in connection with the spin-off, including the separation and distribution agreement, transition services agreement, tax matters agreement, intellectual property matters agreement and employee matters agreement, were

prepared in the context of Crane Company’s spin-off from Crane while Crane Company was still a wholly-owned subsidiary of Crane Holdings, Co. Accordingly, during the period in which the terms of those agreements were prepared, Crane Company did

not have a board of directors or management team that was independent of Crane Holdings, Co. While the parties believe the terms reflect arm’s-length

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terms, there can be no assurance that Crane Company would not have received better terms from unaffiliated third parties than the terms it will receive in its agreements with Crane Holdings, Co.

For more information, see Item 13 “Certain Relationships and Related Party Transactions—Agreements with Crane Holdings, Co. / Crane NXT, Co.” of this Annual Report on Form 10-K.

Some contracts and other assets which will need to be transferred or assigned from Crane to the Company in connection with Crane Company’s spin-off from Crane may

require the consent or involvement of a third-party. If such consent is not given, Crane Company may not be entitled to the benefit of such contracts and other assets in the future, which could negatively impact the Company’s financial

condition and future results of operations.

The separation and distribution agreement and various local transfer agreements will provide that in connection with