Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduced hazardous waste generation by 25% in 5 years (goal, not necessarily achieved in 2021)
• Recycled 40 tons of manufacturing waste materials YTD 2021
• Zero Environmental Recordable Incidents

Social Achievements

• Launched Employee Matching Gift Program
• Donated more than $190,000 to Fort Bend Women’s Center over the last decade
• Will implement a community engagement program in 2022 allowing 8 hours of paid volunteer time off

Governance Achievements

• Increased Board diversity with a quarter of board leadership being women as of September 30, 2021
• Updated policy to prohibit hedging or pledging of shares in 2021
• Established a Code of Business Conduct and a Code of Ethics for Senior Financial Officers

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting manufacturing and operations

Mitigation Strategies

• Created a remote work environment for many employees

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduced hazardous waste generation by 25% in 5 years
• Increased recycle rate up to 30%

Social Achievements

• Introduced a Human Rights Policy Statement in 2022
• Engaged in local communities through competitive hiring practices and philanthropy
• Provided paid time off for volunteerism and corporate match on charitable giving

Governance Achievements

• Established policies, best practices and corporate beliefs
• Board of Directors chaired by a highly experienced, independent Director
• Annual training for all employees on Code of Business Conduct

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Avoid knowing procurement of specified metals that originate from facilities in the “Conflict Region” that are not certified as “conflict free”

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• development of technology solutions to support emerging energy applications such as Carbon Containment and Storage (CCS) and geothermal energy

Reporting Standards

Frameworks Used: Null

Certifications: ISO 14001:2015

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Aquana smart water IoT solutions

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• diversity
• workforce safety and wellbeing
• environmental responsibility
• governance
• human rights

Environmental Achievements

• Recycled over 263 tons of recyclable materials over the last three years; recycled over 174 tons of manufacturing waste materials year-to-date 2023.

Social Achievements

• Implemented significant changes in response to the COVID-19 pandemic to protect employee well-being; provides competitive compensation and benefits programs; invests in talent development and continuous learning; introduced a Human Rights Policy Statement.

Governance Achievements

• Board of Directors is chaired by an independent director; conducts annual Board and Board Committee assessment reviews; Audit Committee ensures integrity of financial statements and compliance; enterprise-wide approach to reviewing business segments; established a Code of Business Conduct and a Code of Ethics for Senior Financial Officers.

Climate Goals & Targets

Environmental Challenges

• Global economic uncertainty and geopolitical strife; high inflation, weakened supply chains, and military conflicts; COVID-19 pandemic disrupting supply chains and extending lead times; oil commodity price levels affecting demand; ongoing armed conflict between Russia and Ukraine affecting operations in Russia and ability to repatriate cash; competition in highly competitive markets; general downturn in the economy; risks associated with renting equipment; expansion into border and perimeter security market may not be successful; cybersecurity breaches; reliance on key suppliers; limited number of key personnel; minimal disaster recovery program; credit agreement imposing restrictions; reliance on third-party subcontractors; high fixed costs; legal and compliance risks associated with global operations; limited market for oil and gas products; rapid technological development and product obsolescence; unfavorable currency exchange rate fluctuations; long-lived assets may be subject to impairment; maintaining an effective system of internal control over financial reporting.

Mitigation Strategies

• Decommissioning and divestiture of older manufacturing equipment; increasing factory automation; consolidating Houston operations; carefully reducing expenses; implementing a plan to discontinue the manufacture of certain low-margin, low-revenue products and reconfigure production facilities; reducing workforce; aggressively working to reduce legacy inventory balances; entering into an IntraFi Cash Service (ICS) Deposit Placement Agreement to mitigate risk of falling outside of FDIC coverage limits; entering into a credit agreement with Woodforest National Bank; actively monitoring the situation in Ukraine and Russia; implementing network security measures; developing new products and services; negotiating for non-refundable deposits or cancellation penalties for large orders; performing ongoing credit evaluations of accounts and financing receivables; acquiring substantial quantities of inventories in anticipation of customer product orders; devoting management time and resources to develop business in the border and perimeter security marketplace; implementing back-up generator for IT operations and offsite data storage; regularly evaluating the collectability of lease receivables; conducting periodic assessments of long-lived assets for impairment; conducting annual evaluation of goodwill for impairment; conducting periodic reviews of inventories to determine if market demand, product modifications, technology changes, excessive quantities on-hand and other factors hinder our ability to recover its investment in such inventories; continually evaluating estimates related to revenue recognition, bad debt reserves, collectability of rental revenue, inventory obsolescence reserves, self-insurance reserves, product warranty reserves, useful lives of long-lived assets, impairment of long-lived assets, impairment of goodwill and other intangible assets, contingent consideration and deferred income tax assets.

Supply Chain Management

Climate-Related Risks & Opportunities