We have in the past and may in the future be exposed to certain market risks, including interest rate, foreign currency exchange in the ordinary course of our business. Market risk represents the risk of loss that may impact our financial condition or results of operations due to adverse changes in financial market prices and rates. These risks are not significant to our results of operations, but they may be in the future. We do not hold or issue financial instruments for speculative or trading purposes. There have not been material changes in market risk exposures as of June 30, 2026. Interest rate risk Changes in interest rates affect the amount of interest expense we are required to pay on our floating rate debt. As of June 30, 2026, we had $375.8 million in outstanding floating rate debt, which bears interest at one-month SOFR (3.64% as of June 30, 2026) plus applicable margin. We entered into the Swap Agreements to convert a portion of the interest rate exposure on our floating rate debt from variable to fixed and designated them as cash flow hedges. Under the terms of the Swap Agreements, we receive payments based on the 1-month SOFR. A portion of the amount included in accumulated other comprehensive (loss) income is reclassified into interest expense, net as a yield adjustment as interest is either paid or received on the hedged debt. The fair value of our Swap Agreements is based upon Level 2 inputs. We have considered our own credit risk and the credit risk of the counterparties when determining the fair value of our Swap Agreements. We performed a sensitivity analysis on the principal amount of debt as of June 30, 2026, as well as the effect of our Swap Agreements. Further, in this sensitivity analysis, the change in interest rates is assumed to be applicable for an entire year. On an annual basis, a change of 100 basis points in the applicable interest rate would cause a change in interest expense of $3.8 million on the principal amount of debt and a $1.4 million change in interest expense when including the effect of our Swap Agreements. As of June 30, 2026, we had the following Swap Agreements (in thousands): ​ ​ ​ ​ ​ ​ ​ Effective Date ​ ​ ​ Notional Amount ​ ​ ​ Fixed Rate September 30, 2021 through July 23, 2026 ​ $ 76,250 ​ 0.812 % May 31, 2023 through July 23, 2026 ​ $ 41,875 ​ ​ ​ 3.905 % February 14, 2025 through December 20, 2029 ​ $ 36,422 ​ ​ ​ 4.080 % April 7, 2025 through December 20, 2029 ​ $ 46,875 ​ ​ ​ 3.545 % July 31, 2025 through December 20, 2029 ​ ​ ​ $ 95,000 ​ ​ ​ 3.449 % ​ During the six months ended June 30, 2026, there were no interest rate swap agreements that expired. Foreign currency exchange rate risk Our operations are geographically diverse and we are exposed to foreign currency exchange risk, primarily the Canadian dollar and Mexican peso, related to our transactions and our subsidiaries’ balances that are denominated in currencies other than the U.S. dollar, our functional currency. 41 Table of Contents CADRE HOLDINGS, INC. MANAGEMENT DISCUSSION AND ANALYSIS (in thousands, except share and per share amounts) ​ The Company has entered into forward contracts to hedge forecasted Mexican peso denominated costs associated with our Mexican subsidiary. These contracts are designated as cash flow hedges to manage foreign currency transaction risk and are measured at fair value and reported as current assets or current liabilities in the condensed consolidated balance sheets. Any changes in the fair value of designated cash flow hedges are recorded in other comprehensive (income) loss and are reclassified from accumulated other comprehensive (loss) income into earnings in the period the hedged item impacts earnings. Significant currency fluctuations could impact the comparability of our results of operations between periods. A 10% increase or decrease in the value of the Canadian dollar to the U.S. dollar would have caused our reported net sales to increase or decrease by approximately $0.6 million and $0.8 million for the three and six months ended June 30, 2026, respectively. A 10% increase or decrease in the value of the Canadian dollar to the U.S. dollar would have caused our reported net income to increase or decrease by approximately $0.1 million and $0.1 million for the three and six months ended June 30, 2026, respectively, excluding unrealized gains or losses from remeasurement. A 10% increase or decrease in the value of the Mexican peso to the U.S. dollar would have caused our reported net income to increase or decrease by approximately $0.6 million and $1.3 million for the three and six months ended June 30, 2026, respectively, excluding unrealized gains or losses from remeasurement and the impact of cash flow hedges.