Albemarle (ALB) 10-K risk factor changes: FY2018 vs FY2017

We conduct a substantial portion of our business outside the U.S., with approximately [removed: 73%] [added: 74%] of our sales to foreign countries.

[removed: In addition, we] [added: We] operate and/or sell our products to customers in approximately 100 countries.

We currently have many production facilities, research and development and administrative facilities, as well as sales offices located outside the [removed: United States,] [added: U.S.,] as detailed in Item 2.

Furthermore, we are subject to rules and regulations related to anti-bribery [added: and anti-trust] prohibitions of the U.S. and other [removed: countries and] [added: countries, as well as] export controls and economic embargoes, violations of which may carry substantial penalties.

[added: Our] raw material and energy costs can be volatile and may increase significantly.

Accordingly, the performance of our business could be adversely affected by any marketing and promotional materials used by our competitors that make adverse claims, whether with or without merit, against our Company or its products, imply or assert immoral or improper conduct by us, or are otherwise [removed: disparaging of our Company or its products.]

Adverse conditions in the [removed: economy] [added: economy,] and volatility and disruption of financial markets can negatively impact our customers, suppliers and other business partners and therefore have a material adverse effect on our business and results of operations.

[removed: The sales of our HPC catalysts, therefore, are largely dependent on the] useful life cycle of the HPC catalysts in the processing units and may vary materially by quarter.

Agencies in the European Union [added: (“E.U.”)] continue to evaluate the risks to human health and the environment associated with certain brominated flame retardants such as tetrabromobisphenol A and decabromodiphenylethane, both of which we manufacture.

Our business and our customers are subject to significant requirements under REACH, which imposes obligations on [removed: European Union] [added: E.U.] manufacturers and importers of chemicals and other products into the [removed: European Union] [added: E.U.] to compile and file comprehensive reports, including testing data, on each chemical substance, and perform chemical safety assessments.

[added: Our significant manufacturing presence and sales activities in the E.U.] requires significant compliance costs and may result in increases in the costs of raw materials we purchase and the products we sell.

Our business is subject to hazards common to chemical and [added: natural] resource extraction businesses, any of which could injure our employees or other persons, damage our facilities or other properties, interrupt our production and adversely affect our reputation and results of operations.

Our business is subject to hazards common to chemical manufacturing, storage, handling and transportation, [added: as well as natural resource extraction,] including explosions, fires, [removed: inclement] [added: severe] weather, natural disasters, mechanical failure, unscheduled downtime, transportation interruptions, remediation, chemical spills, discharges or releases of toxic or hazardous substances or gases and other risks.

In addition, the occurrence of [removed: disruptions] [added: disruptions, shutdowns] or [added: other] material operating problems at our facilities due to any of these hazards may diminish our ability to meet our output goals.

In the jurisdictions in which we operate, we are subject to numerous [added: U.S. and non-U.S. national,] federal, state and local environmental, health and safety laws and regulations, including those governing the discharge of pollutants into the air and water, the management and disposal of hazardous substances and wastes and the cleanup of contaminated properties.

Liabilities associated with the investigation and cleanup of hazardous substances, as well as personal injury, property damages or natural resource damages arising from the release of, or exposure to, such hazardous substances, may be imposed in many situations without [added: regard to violations of laws or regulations or other fault, and may also be imposed jointly and severally (so that a responsible party may be held liable for more than its share of the losses involved, or even the entire loss).]

We may not have insurance coverage for such indemnity [removed: obligations or cash flows to make such indemnity or other payments.]

[removed: Following] [added: As previously reported in 2018, following] receipt of information regarding potential improper payments being made by third party sales representatives of our Refining Solutions business, [added: within our Catalysts segment,] we promptly retained outside counsel and forensic accountants to investigate potential violations of the Company’s Code of Conduct, the FCPA, and other potentially applicable laws.

[added: Based on this internal] investigation, we have voluntarily self-reported potential issues relating to the use of third party sales representatives in our Refining Solutions [removed: business] [added: business, within our Catalysts segment,] to the U.S. Department of Justice [removed: (“DOJ”) and] [added: (“DOJ”), the] SEC, and [removed: intend to cooperate] [added: Dutch Public Prosecutor (“DPP”), and are cooperating] with the [removed: DOJ] [added: DOJ, the SEC,] and [removed: SEC] [added: the DPP] in their review of these matters.

At this time, we are unable to predict the duration, scope, result or related costs associated with [removed: any] [added: the] investigations by the [removed: DOJ] [added: DOJ, the SEC,] or [removed: SEC.][added: DPP.]

We also are unable to predict what, if any, action may be taken by the [removed: DOJ] [added: DOJ, the SEC,] or [removed: SEC] [added: DPP,] or what penalties or remedial actions they may seek.

Any determination that our operations or activities are not in compliance with existing laws or [removed: regulations, however,] [added: regulations] could result in the imposition of fines, penalties, disgorgement, equitable relief, or other losses.

Our having to comply with these foreign laws or regulations [removed: can require] may provide a competitive advantage to competitors who are not subject to comparable restrictions or prevent us from taking advantage of growth opportunities.

We generally rely on patent, trade secret, trademark and copyright laws of the [removed: United States] [added: U.S.] and certain other countries in which our products are produced or sold, as well as licenses and nondisclosure and confidentiality agreements, to protect our intellectual property rights.

The patent, trade secret, trademark and copyright laws of some countries, or their enforcement, may not protect our intellectual property rights to the same extent as the laws of the [removed: United States.][added: U.S. Failure to protect our intellectual property rights may result in the loss of valuable proprietary technologies.]

[removed: Additionally, some of our technologies are not covered by any] patent [removed: or patent] application and, even if a patent application has been filed, it may not result in an issued patent.

In addition, risks associated with information technology systems failures or network disruptions, including risks associated with upgrading our systems or in successfully integrating information technology and other systems in connection with the integration of businesses we acquire, could disrupt our operations by impeding our processing of transactions, financial reporting and our ability to protect our customer or company information, which could adversely [removed: effect] [added: affect] our business [removed: or] [added: and] results of operations.

We are also subject to federal regulations that have heightened security requirements for the transportation of hazardous chemicals in the [removed: United States.][added: U.S. We believe we have met these requirements but additional federal and local regulations that limit the distribution of hazardous materials are being considered.]

In addition, we have operations in the [removed: European Union,] [added: E.U.,] Brazil, China, Japan, Jordan, Saudi Arabia, Singapore and the United Arab Emirates, which have implemented measures to achieve objectives under the Kyoto Protocol, an international agreement linked to the United Nations Framework Convention on Climate Change (“UNFCC”), which set binding targets for reducing greenhouse gas emissions.

Following a referendum in 2016, voters in the United Kingdom (“U.K.”) approved that country’s exit from the [removed: European Union (“E.U.”),] [added: E.U.,] a process often referred to as “Brexit.” Subsequently, in March 2017, the U.K. invoked Article 50 of the Lisbon Treaty, which provides a two-year time period through March 2019 for the U.K. and the remaining E.U. countries to negotiate a withdrawal agreement.

We derive a significant portion of our revenues from sales outside the U.S., including [removed: 17%] [added: 16%] from E.U. countries.

The consequences of Brexit, together with what may be protracted negotiations around the terms of [removed: Brexit,] [added: Brexit (including the possibility of a so-called “Hard Brexit,” where no formal agreement is made between the E.U. and U.K. prior to the U.K.’s exit from the E.U.),] could introduce significant uncertainties into global financial markets, [removed: including volatility in foreign currencies, and adversely impact the markets in which we and our customers operate.]

As of December 31, [removed: 2017,] [added: 2018,] we had approximately [removed: 5,400] [added: 5,900] employees, including employees of our consolidated joint ventures.

In addition, a large number of our employees are employed in countries in which employment laws provide greater bargaining or other rights to employees than the laws of the [removed: United States.][added: U.S. Such employment rights require us to work collaboratively with the legal representatives of those employees to effect any changes to labor arrangements.]

Our capital expenditures generally consist of expenditures to maintain and improve existing [removed: equipment or facilities, or] [added: equipment, facilities and properties, and] substantial investments in new or expanded [removed: equipment] [added: equipment, facilities] and [removed: facilities.][added: properties.]

If we are unable to service our debt obligations, we may need to refinance all or a portion of our indebtedness on or before maturity, reduce or delay capital [added: expenditures, sell assets or raise additional equity.]

The primary currencies to which we have exposure are the [removed: European Union] [added: E.U.] Euro, Japanese Yen, Chinese Renminbi, South Korean Won, Australian Dollar, Chilean Peso and Taiwan Dollar.

With respect to our potential exposure to foreign currency fluctuations and devaluations, for the year ended December 31, [removed: 2017,] [added: 2018,] approximately [removed: 34%] [added: 32%] of our net sales were denominated in currencies other than the U.S. Dollar.

Currently, the majority of our net sales are generated from customers located outside the [removed: United States,] [added: U.S.,] and a substantial portion of our assets and employees are located outside of the [removed: United States.][added: U.S.]

[removed: Certain tax proposals] with respect to such earnings could substantially increase our tax expense, which would substantially reduce our income and have a material adverse effect on our results of operations and cash flows from operating activities.

disparaging of our Company or its products.

The sales of our HPC catalysts, therefore, are largely dependent on the

obligations or cash flows to make such indemnity or other payments.

Additionally, some of our technologies are not covered by any patent or

Our inability to acquire or develop additional reserves that are economically viable could have a material adverse effect on our future profitability.

Our lithium reserves will, without more, decline as we continue to extract these raw materials.

Accordingly, our future profitability depends upon our ability to acquire additional lithium reserves that are economically viable to replace the reserves we will extract.

Exploration and development of lithium resources are highly speculative in nature.

Exploration projects involve many risks, require substantial expenditures and may not result in the discovery of sufficient additional resources that can be extracted profitably.

Once a site with potential resources is discovered, it may take several years of development until production is possible, during which time the economic viability of production may change.

Substantial expenditures are required to establish recoverable proven and probable reserves and to construct extraction and production facilities.

As a result, there is no assurance that current or future exploration programs will be successful and there is a risk that depletion of reserves will not be offset by discoveries or acquisitions.

We utilize feasibility studies to estimate the anticipated economic returns of an exploration project.

The actual project profitability or economic feasibility may differ from such estimates as a result of factors such as, but not limited to, changes in volumes, grades and characteristics of resources to be mined and processed; changes in labor costs or availability of adequate and skilled labor force; the quality of the data on which engineering assumptions were made; adverse geotechnical conditions; availability, supply and cost of water and power; fluctuations in inflation and currency exchange rates; delays in obtaining environmental or other government permits or approvals or changes in the laws and regulations related to our operations or project development; changes in royalty agreements, laws and/or regulations around royalties and other taxes; and weather or severe climate impacts.

For our existing operations, we utilize geological and metallurgical assumptions, financial projections and price estimates.

These estimates are periodically updated to reflect changes in our operations, including modifications to our proven and probable reserves and mineralized material, revisions to environmental obligations, changes in legislation and/or social, political or economic environment, and other significant events associated with natural resource extraction operations.

There are numerous uncertainties inherent in estimating quantities and qualities of lithium and costs to extract recoverable reserves, including many factors beyond our control, that could cause results to differ materially from expected financial and operating results or result in future impairment charges.

There is risk to the growth of lithium markets.

Our lithium business is significantly dependent on the development and adoption of new applications for lithium power and the growth in demand for plug-in hybrid electric vehicles and battery electric vehicles.

To the extent that such development, adoption and growth do not occur in the volume and/or manner that we contemplate, the long-term growth in the markets for lithium products may be adversely affected, which would have a material adverse effect on our business, financial condition and operating results.

including volatility in foreign currencies, and adversely impact the markets in which we and our customers operate.

In addition, our returns on these capital expenditures may not meet our expectations.

Certain tax proposals

earnings to us in the form of dividends, loans or advances and through repayment of loans or advances from us.

Our

Our significant manufacturing presence and sales activities in the European Union

regard to violations of laws or regulations or other fault, and may also be imposed jointly and severally (so that a responsible party may be held liable for more than its share of the losses involved, or even the entire loss).

Based on this internal

Failure to protect our intellectual property rights may result in the loss of valuable proprietary technologies.

We believe we have met these requirements but additional federal and local regulations that limit the distribution of hazardous materials are being considered.

Such employment rights require us to work collaboratively with the legal representatives of those employees to effect any changes to labor arrangements.

expenditures, sell assets or raise additional equity.

We have provided deferred income taxes on the portion of undistributed foreign earnings determined not to be indefinitely reinvested in our foreign operations.

In January 2018, we repatriated approximately $600 million of cash associated with earnings that were previously asserted to be indefinitely reinvested to fund our investment program.

These repatriations do not change our assertion on the remaining foreign earnings that are deemed indefinitely reinvested.

considerations and may be subject to statutory or contractual restrictions.

Factors that could cause actual results to differ materially from the outlook expressed or implied in any forward-looking statement include, without [removed: limitation:][added: limitation, information related to:]

| • | the occurrence of regulatory [added: actions,] proceedings, claims or litigation; |

| • | technology or intellectual property infringement, including [added: through] cyber-security breaches, and other innovation risks; |

The following is a discussion and analysis of our results of operations for the years ended December 31, [removed: 2017, 2016] [added: 2018, 2017] and [removed: 2015.][added: 2016.]

[added: |] 2017 [removed: Highlights][added: | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| • | In the first quarter, we increased our quarterly dividend for the [removed: 23rd] [added: 24th] consecutive year, to [removed: $0.32] [added: $0.335] per share. |

| • | We achieved earnings [removed: from continuing operations] of [removed: $99.5] [added: $693.6] million during [removed: 2017] [added: 2018] as compared to [removed: $478.6] [added: $54.9] million for [removed: 2016.] [added: 2017.] Cash flows from operations in [removed: 2017] [added: 2018] were [removed: $304.0] [added: $546.2] million. Earnings [added: for 2018 included a $169.9 million after-tax gain] from [removed: continuing operations] [added: the Polyolefin Catalysts Divestiture, while earnings] for 2017 [added: were negatively impacted by the $366.9 million net income tax expense resulting from the enactment of the TCJA. In addition, earnings for 2018] includes pension and other postretirement benefit (“OPEB”) actuarial [removed: gains] [added: losses] of [removed: $7.3] [added: $10.6] million after income taxes, compared to pension and OPEB actuarial [removed: losses] [added: gains] of [removed: $18.3] [added: $7.3] million after income taxes in [removed: 2016.] [added: 2017.] |

The other markets we serve continue to present various opportunities for value and growth as we have positioned ourselves to manage [added: the impact on our business of] changing global conditions, such as slow and uneven global growth, currency exchange volatility, crude oil price fluctuation, a dynamic pricing [removed: environment and] [added: environment,] an ever-changing landscape in electronics, the continuous need for cutting edge catalysts and technology by our refinery customers and increasingly stringent environmental standards.

[removed: Lithium and Advanced Materials:] [added: Lithium:] We expect [removed: continued strong year over year growth for the remainder] [added: a similar rate] of [added: growth in 2019 as in] 2018 in Lithium, led by continued strong demand in battery-grade applications, price improvement and increased conversion capacity.

On a longer term basis, we believe that demand for lithium will continue to grow as new [removed: applications for] lithium [removed: power continue to be developed] [added: applications advance] and the use of plug-in hybrid electric vehicles and [added: full] battery electric vehicles [removed: escalates, against a favorable backdrop of steadily declining electric battery costs, increasing electric battery performance and constructive global public policy toward acceptance of e-mobility/renewables.][added: increases.]

Our long-term outlook is also bolstered by our successful negotiation of long-term supply agreements with [removed: a number of] [added: our key] strategic customers, reflecting our standing as a preferred global lithium [removed: partner due to] [added: partner, highlighted by] our scale, access to geographically diverse, [removed: low cost resources] [added: low-cost resource base] and long-term [removed: execution track record.][added: focus on execution.]

In PCS, we expect growth in [removed: the] [added: our] organometallic business due to growing global demand for plastics driven by rising standards of living and infrastructure spending.

[removed: With] [added: However, with] sustained low oil prices, we expect stable, albeit low, drilling completion fluid demand throughout the year.

While it is possible oil prices could [added: continue to] rebound some in [removed: 2018,] [added: 2019,] the short-term impact will be to increase raw material costs.

Offshore well completions lag oil pricing, so any benefit in completion fluid volumes would likely extend [removed: into 2019.][added: throughout the year.]

[removed: Both businesses faced] [added: Catalysts: We expect to see continued] headwinds from rising raw material costs in [removed: 2017] [added: both our CFT] and [removed: we expect that trend] [added: FCC businesses, similar] to [removed: continue in] 2018.

On a longer term basis, we believe increased global demand for transportation fuels, new refinery start-ups and ongoing adoption of cleaner fuels will be the primary drivers of growth in our [removed: Refining Solutions] [added: Catalysts] business.

With superior technology and production capacities, and expected growth in end market demand, we believe that [removed: Refining Solutions] [added: Catalysts] remains well-positioned for the future.

We expect our global effective tax rate for [removed: 2018] [added: 2019] to be between 23% and 24%; however, our rate will vary based on the locales in which income is actually earned and remains subject to potential volatility from changing legislation in the [removed: U.S.] [added: U.S., including the TCJA,] and other tax jurisdictions.

In the first quarter of [removed: 2018,] [added: 2019,] we increased our quarterly dividend rate to [removed: $0.335] [added: $0.3675] per share.

During [removed: 2017,] [added: 2018,] we received and retired approximately [removed: 2.3] [added: 5.3] million shares of our common stock under our share repurchase program and [removed: the] ASR [removed: agreement,] [added: agreements,] and we may periodically repurchase shares in the future on an opportunistic basis as approved by our share repurchase program.

[removed: Results for the year ended] December 31, [removed: 2017] [added: 2018] include an actuarial [removed: gain] [added: loss] of [removed: $11.4] [added: $14.0] million [removed: ($7.3] [added: ($10.6] million after income taxes), as compared to a [removed: loss] [added: gain] of [removed: $26.7] [added: $11.4] million [removed: ($18.3] [added: ($7.3] million after income taxes) [removed: from continuing operations] for the year ended December 31, [removed: 2016.][added: 2017.]

| | [removed: 2017] [added: 2018] | | | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2017] [added: 2018] vs. [removed: 2016] [added: 2017] | | | [removed: 2016] [added: 2017] vs. [removed: 2015] [added: 2016] | |

| NET SALES | $ | [removed: 3,071,976] [added: 3,374,950] | | | $ | [removed: 2,677,203] [added: 3,071,976] | | | $ | [removed: 2,826,429] [added: 2,677,203] | | | [removed: 15] [added: 10] | % | | [removed: (5] [added: 15] | [removed: )%] [added: %] |

| GROSS PROFIT MARGIN | 36.1 | | % | | [removed: 36.3] [added: 36.0] | | % | | [removed: 30.4] [added: 36.2] | | % | | | | | | |

| Research and development expenses | [removed: 84,330] [added: 70,054] | | | | [removed: 80,475] [added: 84,330] | | | | [removed: 89,187] [added: 80,475] | | | | [removed: 5] [added: (17] | [removed: %] [added: )%] | | [removed: (10] [added: 5] | [removed: )%] [added: %] |

| Restructuring and [removed: other, net] [added: other(a)] | — | | | | — | | | | [removed: (6,804] [added: —] | | [removed: )] | | — | [removed: %] | | [removed: (100] | [removed: )%] [added: —] | [added: | | | 3,838 | | | | 3,838 | | |]

| Gain on sales of businesses, net | [added: (210,428 | | ) | |] — | | | | (122,298 | | ) | | [removed: — |] [added: *] | | | (100 | )% | [removed: | * | |]

| Acquisition and integration related costs | — | | | | [removed: 57,384] [added: —] | | | | [removed: 132,299] [added: 57,384] | | | | [removed: (100] [added: —] | [removed: )%] [added: %] | | [removed: (57] [added: (100] | )% |

| Interest and financing expenses | [removed: (115,350] [added: (52,405] | | ) | | [removed: (65,181] [added: (115,350] | | ) | | [removed: (81,650] [added: (65,181] | | ) | | [removed: 77] [added: (55] | [removed: %] [added: )%] | | [removed: (20] [added: 77] | [removed: )%] [added: %] |

[removed: |] Other [removed: (expenses) income, net | (25,601 | | ) | | 5,894 | | | | 47,283 | | | | * | | | (88 | )% |][added: Expenses, Net]

| INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND EQUITY IN NET INCOME OF UNCONSOLIDATED INVESTMENTS | [removed: 446,798] [added: 794,701] | | | | [removed: 515,264] [added: 446,798] | | | | [removed: 310,744] [added: 515,264] | | | | [removed: (13] [added: 78] | [removed: )%] [added: %] | | [removed: 66] [added: (13] | [removed: %] [added: )%] |

| Income tax expense | [removed: 431,817] [added: 144,826] | | | | [removed: 96,263] [added: 431,817] | | | | [removed: 11,134] [added: 96,263] | | | | [removed: 349] [added: (66] | [removed: %] [added: )%] | | [removed: *] [added: 349] | [added: %] |

| Effective tax rate | [removed: 96.6] [added: 18.2] | | % | | [removed: 18.7] [added: 96.6] | | % | | [removed: 3.6] [added: 18.7] | | % | | | | | | |

| INCOME FROM CONTINUING OPERATIONS BEFORE EQUITY IN NET INCOME OF UNCONSOLIDATED INVESTMENTS | [removed: 14,981] [added: 649,875] | | | | [removed: 419,001] [added: 14,981] | | | | [removed: 299,610] [added: 419,001] | | | | [removed: (96] [added: *] | [removed: )%] | | [removed: 40] [added: (96] | [removed: %] [added: )%] |

| Equity in net income of unconsolidated investments (net of tax) | [removed: 84,487] [added: 89,264] | | | | [removed: 59,637] [added: 84,487] | | | | [removed: 27,978] [added: 59,637] | | | | [removed: 42] [added: 6] | % | | [removed: 113] [added: 42] | % |

| NET INCOME FROM CONTINUING OPERATIONS | [removed: 99,468] [added: 739,139] | | | | [removed: 478,638] [added: 99,468] | | | | [removed: 327,588] [added: 478,638] | | | | [removed: (79] [added: 643] | [removed: )%] [added: %] | | [removed: 46] [added: (79] | [removed: %] [added: )%] |

| Income from discontinued operations (net of tax) | — | | | | [removed: 202,131] [added: —] | | | | [removed: 32,476] [added: 202,131] | | | | [removed: (100] [added: —] | [removed: )%] [added: %] | | [removed: *] [added: (100] | [added: )%] |

| NET INCOME | [removed: 99,468] [added: 739,139] | | | | [removed: 680,769] [added: 99,468] | | | | [removed: 360,064] [added: 680,769] | | | | [removed: (85] [added: 643] | [removed: )%] [added: %] | | [removed: 89] [added: (85] | [removed: %] [added: )%] |

| Net income attributable to noncontrolling interests | [removed: (44,618] [added: (45,577] | | ) | | [removed: (37,094] [added: (44,618] | | ) | | [removed: (25,158] [added: (37,094] | | ) | | [removed: 20] [added: 2] | % | | [removed: 47] [added: 20] | % |

2018 Highlights

| • | We received approval from CORFO for an increase in our lithium quota to sustainably increase lithium production in Chile to as much as 145,000 metric tons of lithium carbonate equivalent annually through 2043. |

| • | On April 3, 2018, we completed the Polyolefin Catalysts Divestiture to W.R. Grace & Co. for net cash proceeds of approximately $413.6 million and recorded a gain of $210.4 million before income taxes related to the sale of this business. |

| • | In June 2018, we entered into a revolving, unsecured credit agreement that provides for borrowings of up to $1.0 billion and matures on June 21, 2023 (the “2018 Credit Agreement”) to replace our existing revolving, unsecured credit agreement. |

| • | We announced our exclusive collaboration with DuPont as the primary hydroprocessing catalyst manufacturer for the DuPont™ IsoTherming® hydroprocessing technology, making clean fuels production more cost efficient for refiners. IsoTherming® is an innovative hydroprocessing technology that can lower capital and operational costs. |

| • | We launched XPLORE™, a new platform for the clean transportation fuels market. The XPLORE catalyst platform is the result of breakthrough research in hyrdroprocessing catalyst technology allowing refineries to produce clean transportation fuels in a more efficient way. The new PULSAR family, with KF 787 PULSAR™ as its first grade product, is a cutting-edge, premium catalyst line, designed for the production of clean diesel. |

| • | We entered into two separate $250 million ASR agreements in May and August 2018, respectively. We completed these ASR agreements in September and December 2018, respectively, receiving and retiring a total of 5,262,654 shares. |

| • | We successfully completed the commissioning of our La Negra facility in Chile (“La Negra II”), which has a nameplate capacity of 20,000 metric tons of lithium carbonate. Upon completion of the ramp-up of La Negra II, the total capacity of our facilities in La Negra, Chile will be 44,000 metric tons. |

| • | We completed pre-commissioning activities related to our new facility in Xinyu, China and began start-up activities. This expansion will result in an additional 20,000 metric tons of lithium hydroxide, bringing total site capacity to 30,000 metric tons, with significant volumes expected from the new unit in 2019. |

| • | We entered into a definitive agreement to acquire a 50% interest in Mineral Resources Limited's Wodgina Project in Western Australia and form a joint venture with Mineral Resources Limited to own and operate the Wodgina Project to produce spodumene concentrate and battery grade lithium hydroxide, for a purchase price of $1.15 billion. The joint venture will ultimately construct a battery grade lithium hydroxide plant at the resource site. This transaction is subject to regulatory approvals and other customary closing conditions, and is expected to close in the second half of 2019. |

| • | We received the required environmental approvals from Australian federal and state government for the Company’s proposed Kemerton lithium hydroxide conversion site in Western Australia. This plant will have an initial capacity of 60,000 metric tons of lithium hydroxide with an ability to expand to 100,000 metric tons over time. The commissioning of this site is expected to start in stages during the course of 2021. |

| • | In December 2018, we exercised an $18 million option to purchase undeveloped land with access to a lithium resource in Antofalla, within the Catamarca Province of Argentina from Bolland Minera S.A. We believe this asset could be certified as the largest lithium resource in Argentina. |

This demand for lithium is supported against a favorable backdrop of steadily declining lithium ion battery costs, increasing battery performance and an increasingly favorable global public policy toward acceptance of e-mobility/renewable energy usage.

Bromine Specialties: We expect to see continued growth in net sales and profitability in 2019, due to healthy demand and pricing for our flame retardants and other derivatives.

On April 3, 2018, we completed the Polyolefin Catalysts Divestiture to W.R. Grace & Co. for net cash proceeds of approximately $413.6 million.

We expect the near future to be impacted by a challenging agriculture industry environment and the timing of customer orders in pharmaceuticals.

We continue to work to reinvigorate the pipeline of new products and services to these markets.

Results for the year ended

| Cost of goods sold | 2,157,694 | | | | 1,965,700 | | | | 1,706,897 | | | | 10 | % | | 15 | % |

| GROSS PROFIT | 1,217,256 | | | | 1,106,276 | | | | 970,306 | | | | 10 | % | | 14 | % |

| Selling, general and administrative expenses | 446,090 | | | | 450,286 | | | | 353,765 | | | | (1 | )% | | 27 | % |

| OPERATING PROFIT | 911,540 | | | | 571,660 | | | | 600,980 | | | | 59 | % | | (5 | )% |

| OPERATING PROFIT MARGIN | 27.0 | | % | | 18.6 | | % | | 22.4 | | % | | | | | | |

| Other expenses, net | (64,434 | | ) | | (9,512 | | ) | | (20,535 | | ) | | 577 | % | | (54 | )% |

Comparison of 2018 to 2017

Net sales increased, including in all three reportable segments, due to $210.6 million of higher volumes, $141.0 million of favorable pricing impacts and $30.6 million of favorable currency exchange.

This was partially offset by $78.9 million of net sales from the Polyolefin Catalysts Divestiture.

Cost of goods sold for the year ended December 31, 2018 included a decrease of $13.4 million in acquisition, integration and restructuring related costs from various significant projects compared to the corresponding period in 2017, and $8.8 million related to non-routine labor and compensation related costs in Chile that are outside normal compensation arrangements.

In addition, Gross profit for the year ended December 31, 2017 included a $23.1 million charge related to the markup of inventory purchased as part of the acquisition of Jiangli New Materials and $30.4 million of gross profit from the Polyolefin Catalysts Divestiture.

In addition, gross profit increased $19.6 million in Catalysts and Bromine Specialties due to the year over year impact of hurricane Harvey, which includes a partial insurance claim reimbursement of $4.2 million in 2018.

Excluding the impact of these items, gross profit increased by $93.9 million, or 8.3%, due to $141.0 million in favorable pricing impacts and approximately $77 million of higher volumes, more than offsetting higher material and utility costs of approximately $60 million and price-related royalties of approximately $30 million.

Additionally higher production costs and the negative impact of currency exchange on material and production costs in foreign locations resulted in approximately $30 million in offsets.

SG&A expenses for the year ended December 31, 2018 included $16.2 million of charitable contributions beyond the Company’s ordinary, recurring charitable contributions, a decrease in restructuring and other costs related to several locations of $4.7 million and $3.9 million less acquisition and integration related costs for various significant projects.

The remaining decrease was primarily due to lower compensation related costs, particularly incentive compensation, and professional fees.

The remaining decrease was primarily due to $4.5 million of R&D expenses related to the Polyolefin Catalysts Divestiture.

The year ended December 31, 2018 included a gain before income taxes of $210.4 million related to the Polyolefin Catalysts Divestiture, which we completed in the second quarter of 2018.

Interest and financing expenses for the year ended December 31, 2018 decreased $62.9 million to $52.4 million from the corresponding 2017 period, due mainly to a loss on early extinguishment of debt of $52.8 million in 2017 relating to the tender premiums, fees, unamortized discounts and unamortized deferred financing costs from the repayment of the 3.00% Senior notes in full, €307.0 million of the 1.875% Senior notes and $174.7 million of the 4.50% Senior notes.

The remaining difference is primarily related to the impact of higher capitalized interest from increased capital expenditures in 2018.

(including mark-to-market actuarial gains of $11.4 million) in 2017.

In addition, during the year ended December 31, 2018, we incurred $27.0 million of legal expenses related to products that Albemarle no longer manufactures and a previously disposed business, $19.7 million to increase an indemnification liability related to the settlement of an ongoing audit of a previously disposed business in Germany and $15.6 million of environmental charges related to a site formerly owned by Albemarle, partially offset by a $2.1 million gain in the fair value of our investment in private equity securities.

| • | We repaid the 3.00% Senior notes in full, €307.0 million of the 1.875% Senior notes and $174.7 million of the 4.50% Senior notes, as well as related tender premiums of $45.2 million, using a portion of the proceeds from the sale of the Chemetall Surface Treatment business. |

| • | We announced that Albemarle and Tianqi Lithium Corporation (“Tianqi”) terminated the option agreement for Tianqi to acquire a 20% indirect ownership interest in Rockwood Lithium GmbH, a wholly-owned German subsidiary of Albemarle, and its subsidiaries. As a result, we will retain 100% of the ownership interest in Rockwood Lithium GmbH. |

| • | We announced the approval for the expansion of lithium concentrate production at our Greenbushes, Australia site through our 49% owned Talison joint venture. Commissioning of the expansion is expected to begin in the second quarter of 2019 and would more than double the current lithium carbonate capacity. |

| • | We completed a $250 million accelerated share repurchase (“ASR”) program, receiving and retiring 2,341,083 shares of our common stock pursuant to the terms of the ASR agreement and our share repurchase program. |

| • | We announced that we have developed an innovative technology that could lead to a sustainable increase in total lithium production in Chile to as much as 125,000 metric tons of lithium carbonate equivalent annually, without the need for additional brine pumping at the Salar de Atacama. As a result of this development, we have requested that Chile’s Economic Development Agency (“CORFO”) increase our lithium quota. As of the date of this Annual Report, CORFO is yet to conclude on the Company’s request. |

| • | In November 2017, we announced that during the first quarter of 2018, the PCS product category will merge with the Refining Solutions reportable segment to form a global business focused on catalysts. As a result, our three reportable segments will include: (1) Lithium, (2) Bromine Specialties and (3) Catalysts. |

| • | On December 14, 2017, we signed a definitive agreement to sell the polyolefin catalysts and components portion of our PCS business to W.R. Grace & Co. for proceeds of approximately $416 million in cash. The transaction includes Albemarle’s Product Development Center located in Baton Rouge, Louisiana, and operations at its Yeosu, South Korea site, and is expected to close in the first quarter of 2018. |

| • | We announced a new technology for the FCC catalyst market called Granite™. The Granite™ technology expands the catalyst formulation window and enables refiners to maximize their profitability through better bottoms upgrading, improved coke selectivity, and higher zeolite stability while achieving targeted product yields. |

In 2017, our operations were managed and reported under three reportable segments: Lithium and Advanced Materials, Bromine Specialties and Refining Solutions.

Financial results and discussion about our segments included in this Annual Report on Form 10-K are organized according to these categories except where noted.

In 2017, PCS experienced weaker profitability due to pricing pressure and the impact of hurricane Harvey, partially offset by

productivity and cost savings initiatives.

We expect PCS profitability to stabilize in 2018 due to productivity gains and increased volumes due to market demand, offset by unfavorable pricing due to excess supply.

On December 14, 2017, we signed a definitive agreement to sell the polyolefin catalysts and components portion of the PCS business to W.R. Grace & Co. for proceeds of approximately $416 million in cash.

The sale is expected to close in the first quarter of 2018, subject to the satisfaction of customary closing conditions, including approvals from regulatory authorities.

In addition, during the first quarter of 2018, the PCS product category will merge with the Refining Solutions reportable segment to form a global business focused on catalysts and be reported in a separate reportable segment.

Bromine Specialties: The Bromine Specialties business had a solid 2017, with strong volume growth in fire safety and other derivatives driving double digit earnings growth year over year.

We expect to see relatively flat growth on net sales and profitability in 2018.

We are expecting relatively stable fire safety and other derivative net sales and profits in 2018.

Refining Solutions: Following a year of significant increases in the number of “Hydro treating unit” catalyst change-outs and marked improvement in catalyst product mix, our CFT business performed as expected.

Our FCC business also performed as expected, despite impacts from hurricane Harvey.

We expect the next few years to be a challenge for fine chemistry services due to a challenging agriculture industry environment, as well as customer order timing in pharmaceuticals.

In December 2017, the TCJA was signed into law in the U.S., which among other things, lowers the U.S.

corporate income tax rate from 35% to 21%, implementing a territorial tax system for non-U.S. earnings and imposing a one-time transition tax on the undistributed earnings of certain non-U.S. subsidiaries.

We also anticipate the potential for increased volatility in future effective tax rates from the continuing impact of the Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2016-09, which was adopted in the first quarter of 2017.

| Cost of goods sold | 1,961,996 | | | | 1,706,627 | | | | 1,966,196 | | | | 15 | % | | (13 | )% |

| GROSS PROFIT | 1,109,980 | | | | 970,576 | | | | 860,233 | | | | 14 | % | | 13 | % |

| Selling, general and administrative expenses | 437,901 | | | | 380,464 | | | | 300,440 | | | | 15 | % | | 27 | % |

| OPERATING PROFIT | 587,749 | | | | 574,551 | | | | 345,111 | | | | 2 | % | | 66 | % |

| OPERATING PROFIT MARGIN | 19.1 | | % | | 21.5 | | % | | 12.2 | | % | | | | | | |

The year ended December 31, 2016 included gains before income taxes of $11.5 million and $112.3 million related to the sales of the metal sulfides business and the minerals-based flame retardants and specialty chemicals business, respectively, both of which closed in the first quarter of 2016.

In addition, Gain on sales of businesses, net, for the year ended December 31, 2016 included a loss of $1.5 million on the sale of our wafer reclaim business.

The year ended December 31, 2016 included $52.1 million of acquisition and integration related costs directly related to the acquisition of Rockwood (mainly consisting of professional services, costs to achieve synergies, relocation costs, and other integration costs) and $5.3 million of costs in connection with other significant projects.

Our effective tax rate for 2016 was affected by discrete net tax expense items of $20.2 million related mainly to a tax gain from restructuring the ownership of a foreign subsidiary, foreign tax rate changes, provision to return adjustments and changes in valuation allowances necessary due to the restructuring.

This gain represents the difference between the carrying value of the related assets and their fair value as determined by the sales price less estimated costs to sell, and included the reversal of $81.4 million of foreign currency translation loss out of Accumulated other comprehensive loss.

Included in the currency movements for 2016 is the favorable effect of $81.4 million in accumulated foreign currency translation losses that were reversed as a result of the sale of the Chemetall Surface Treatment business.

The “All Other” category comprises three operating segments that do not fit into any of our core businesses subsequent to the acquisition of Rockwood: minerals-based flame retardants and specialty chemicals, fine chemistry services and metal sulfides.

| Lithium and Advanced Materials | | $ | 1,308,153 | | | 42.6 | % | | $ | 968,216 | | | 36.2 | % | | 35 | % |

| Refining Solutions | | 778,304 | | | | 25.3 | % | | 732,137 | | | | 27.3 | % | | 6 | % |

| Lithium and Advanced Materials | | $ | 518,530 | | | 58.6 | % | | $ | 363,360 | | | 48.0 | % | | 43 | % |

Unless otherwise noted, gains and losses on foreign currency forward contracts are recognized currently in Other [removed: (expenses) income,] [added: expenses,] net, and generally do not have a significant impact on results of operations.

At December 31, [removed: 2017,] [added: 2018,] our financial instruments subject to foreign currency exchange risk consisted of foreign currency forward contracts with an aggregate notional value of [removed: $357.4] [added: $626.5] million and with a fair value representing a net [removed: liability] [added: asset] position of [removed: $5.0] [added: $0.4] million.

We conducted a sensitivity analysis on the fair value of our foreign currency hedge portfolio assuming an instantaneous 10% change in select foreign currency exchange rates from their levels as of December 31, [removed: 2017,] [added: 2018,] with all other variables held constant.

A 10% appreciation of the U.S. Dollar against foreign currencies that we hedge would result in [removed: an increase] [added: a decrease] of approximately [removed: $12.5] [added: $24.4] million in the fair value of our foreign currency forward contracts.

A 10% depreciation of the U.S. Dollar against these foreign currencies would result in [removed: a decrease] [added: an increase] of approximately [removed: $14.9] [added: $26.8] million in the fair value of our foreign currency forward contracts.

The sensitivity of the fair value of our foreign currency hedge portfolio represents changes in fair values estimated based on market conditions as of December 31, [removed: 2017,] [added: 2018,] without reflecting the effects of underlying anticipated transactions.

On December 18, 2014, the carrying value of our 1.875% Euro-denominated senior notes was designated as an effective hedge of our net investment in foreign subsidiaries where the Euro serves as the functional currency, and beginning on the date of designation, gains or losses on the revaluation of these senior notes to our reporting currency have been and will be recorded [added: in Accumulated other comprehensive loss.]

In January 2017, we repaid €307.0 million of these senior notes using proceeds from [removed: the sale of the Chemetall Surface Treatment business.]

We had variable interest rate borrowings of [removed: $426.6] [added: $313.8] million and [removed: $286.4] [added: $426.6] million outstanding at December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] respectively.

These borrowings represented [removed: 23%] [added: 18%] and [removed: 11%] [added: 23%] of total outstanding debt and bore average interest rates of [removed: 1.78%] [added: 2.85%] and [removed: 1.35%] [added: 1.78%] at December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] respectively.

A hypothetical 10% increase (approximately [removed: 18] [added: 29] basis points) in the average interest rate applicable to these borrowings would change our annualized interest expense by approximately [removed: $0.8] [added: $0.9] million as of December 31, [removed: 2017.][added: 2018.]

the sale of the Chemetall Surface Treatment business.

in Accumulated other comprehensive loss.

Our principal executive offices are located at [removed: 4350] [added: 4250] Congress Street, Suite [removed: 700,] [added: 900,] Charlotte, North Carolina 28209.

[removed: The Chemetall® Surface Treatment business, acquired as a part of Rockwood, was sold on] [added: On] December 14, [removed: 2016] [added: 2016, we completed the sale of the Chemetall Surface Treatment business] to BASF SE for [added: net] cash proceeds of approximately $3.1 [removed: billion, net of purchase price adjustments.][added: billion.]

For [removed: additional] [added: financial] information [removed: about these transactions, see “Recent Acquisitions, Joint Ventures] [added: regarding our reportable segments] and [removed: Divestitures” beginning on page 8,] [added: geographic area information, see] Note [removed: 2, “Acquisitions,”] [added: 24, “Segment] and [removed: Note 3, “Divestitures,”] [added: Geographic Area Information,”] to our consolidated financial statements included in Part II, Item 8 of this report.

We and our joint ventures currently operate [removed: 31] [added: 29] production and research and development (“R&D”) facilities, as well as a number of administrative and sales offices, around the world.

As of December 31, [removed: 2017,] [added: 2018,] we served approximately [removed: 2,500] [added: 2,300] customers, none of which individually represents more than 10% of net sales of the Company, in approximately 100 countries.

Each segment has a dedicated team of sales, research and development, process engineering, manufacturing and sourcing, and business strategy personnel and has full accountability for improving execution through greater asset [removed: and] [added: efficiency,] market focus, agility and responsiveness.

Financial results and discussion about our segments included in this Annual Report on Form 10-K are organized according to these categories except where [removed: noted otherwise.][added: noted.]

[removed: In November 2017, we announced that during the first quarter of] [added: Effective January 1,] 2018, the [removed: Performance Catalyst Solutions ("PCS")] [added: PCS] product category [removed: will merge] [added: merged] with [removed: the] [added: our former] Refining Solutions reportable segment to form a global business focused on catalysts.

As a result, our three reportable segments [removed: will include: (1)] [added: include] Lithium, [removed: (2)] Bromine Specialties and [removed: (3)] Catalysts.

Lithium [removed: and Advanced Materials] Segment

Our Lithium business develops [removed: advanced] [added: lithium] materials for a wide range of industries and end markets.

[removed: Our Lithium business is] [added: We are] a low-cost producer of one of the most diverse product portfolios of lithium derivatives in the industry.

Lithium is a key component in products and processes used in a variety of applications and industries, which include lithium batteries used in consumer electronics and [removed: automobiles,] [added: electric vehicles,] high performance greases, thermoplastic elastomers for car tires, rubber soles and plastic bottles, catalysts for chemical reactions, organic synthesis processes in the areas of steroid chemistry and vitamins, various life science applications, as well as intermediates in the pharmaceutical industry, among other applications.

[removed: Lithium—Competition][added: Competition]

The global lithium market consists of producers [added: primarily] located in the Americas, [removed: Asia-Pacific and, to a lesser extent, Africa.][added: Asia and Australia.]

Major competitors [added: in lithium compounds] include [removed: FMC] [added: Livent] Corporation, Sociedad Quimica y Minera de Chile S.A., [removed: SichuanTianqi] [added: Sichuan Tianqi] Lithium, and Jiangxi Ganfeng Lithium.

In the [removed: metal-based] [added: cesium and other] specialty [removed: chemicals] [added: metal] business, key competitors include Cabot Corporation and Sigma-Aldrich Corporation.

[removed: Lithium—Raw] [added: Raw] Materials and Significant Supply Contracts

[removed: The] [added: In addition, the amended] agreement provides for commission payments to the Chilean government based on sales [removed: price/MT and] [added: price/metric ton,] our support of research and development in Chile in lithium applications and solar [removed: energy.][added: energy, and our support of local communities in Northern Chile.]

The amended agreement provides us with sufficient lithium to produce over 80,000 metric tons annually of technical and battery grade lithium salts over the next [removed: 26] [added: 25] years at our expanding battery grade manufacturing facilities in La Negra, Chile.

In [removed: September 2017, we announced that] [added: March 2018,] we [removed: have developed an innovative technology that could lead] [added: received approval from Chilean Economic Development Agency (“CORFO”)] to [removed: a sustainable] increase [removed: in total] lithium production [added: quota] in Chile to as much as [removed: 125,000] [added: 145,000] metric tons of lithium carbonate equivalent [removed: annually,] [added: annually through 2043, after developing an innovative technology that could lead to a sustainable increase in total lithium production in Chile] without the need for additional brine pumping at the Salar de Atacama.

Based on our [removed: 2017] [added: 2018] production levels, we believe that the amount of lithium brine we can economically obtain from our Silver Peak, Nevada site pursuant to our rights could support the current levels of lithium carbonate production for approximately 20 years.

Assuming certain operating conditions are satisfied, our annual lithium carbonate production capacity is estimated to be [removed: approximately] [added: at least] 6,000 metric tons at our Silver Peak facility.

We also [removed: own a] [added: obtain lithium through hard rock mining via our] 49% interest in Windfield Holdings Pty.

The ore is processed into battery-grade lithium carbonate and lithium hydroxide at our Jiangxi and Sichuan, China [removed: facilities, which were recently acquired by us from Jiangxi Jiangli New Materials Science and Technology Co. Ltd. (“Jiangli New Materials”).][added: facilities.]

Talison has a leading position in two categories of lithium concentrates: (i) technical-grade lithium concentrates which have low iron content for use in the manufacture of glass, ceramics and heat-proof cookware; and (ii) a high-yielding chemical-grade lithium concentrate, used to produce lithium chemicals which form the basis for the manufacture of lithium-ion batteries for laptop [added: computers, mobile phones, electric bicycles and electric vehicles.]

Assuming certain operating conditions are satisfied, the annual lithium carbonate equivalent production capacity at the Talison facility is estimated to be approximately [removed: 80,000] [added: 105,000] metric [removed: tons.][added: tons and will be approximately 190,000 metric tons upon completion of an expansion currently underway, with commissioning expected in 2019.]

On [removed: December 14, 2017,] [added: April 3, 2018,] we [removed: signed a definitive agreement to sell] [added: completed] the [added: sale of the] polyolefin catalysts and components portion of the PCS business [added: (“Polyolefin Catalysts Divestiture”)] to W.R. Grace & Co. for [added: net cash] proceeds of [removed: approximately $416 million in cash.][added: $413.6 million.]

The transaction [removed: includes] [added: included] Albemarle’s [removed: Product] [added: Process] Development Center located in Baton Rouge, Louisiana, and operations at the Yeosu, South Korea site.

The [removed: transaction does] [added: sale did] not include [removed: the] [added: our] organometallics or curatives portion of the PCS business.

Our [removed: PCS business] [added: Catalysts segment] serves the global market including the Americas, [removed: Europe, Asia] [added: Asia, Europe] and the Middle [removed: East.][added: East, each of which is highly competitive.]

[removed: Our major competitors in] [added: In] the PCS [removed: market] [added: market, our major competitors] include [removed: AkzoNobel,] [added: Nouryon,] Lanxess AG and [removed: W.R. Grace & Co. in the polyolefin catalysts and co-catalysts areas.][added: Lonza.]

The major raw materials we use in our [removed: PCS] [added: Catalysts] operations include [added: sodium silicate, sodium aluminate, kaolin,] aluminum, ethylene, alpha-olefins, [removed: isobutylene] [added: isobutylene, toluene] and [removed: toluene,] [added: rare earths and metals, such as molybdenum, nickel and cobalt,] most of which are readily available from numerous independent suppliers and are purchased or provided under contracts at prices we believe are competitive.

[removed: End market products that benefit from our fire safety technology include plastic] enclosures for consumer electronics, printed circuit boards, wire and cable products, electrical connectors, textiles and foam insulation.

We estimate that, at current production levels, we will be able to produce bromine in Arkansas for [removed: more than 50 years.][added: decades.]

[added: In addition, through our 50% interest in Jordan Bromine Company] Limited (“JBC”), a consolidated joint venture with operations in Safi, Jordan, we source bromine from the Dead Sea, which is believed to have indefinite quantities of brine.

Our [removed: two] [added: three] main product lines in this segment are (i) Clean Fuels Technologies (“CFT”), which is primarily composed of hydroprocessing catalysts (“HPC”) together with isomerization and akylation [removed: catalysts, and] [added: catalysts;] (ii) fluidized catalytic cracking (“FCC”) catalysts and [removed: additives.][added: additives; and (iii) performance catalyst solutions (“PCS”), which is primarily composed of organometallics and curatives.]

[added: We offer a wide range of] HPC [removed: products] [added: products, which] are [removed: widely] applied throughout the refining industry.

In [removed: 2017,] [added: 2018,] the [removed: total] number of refineries [removed: world wide remained at] [added: world-wide was approximately] 615.

[removed: Research] [added: Product performance] and [removed: development,] [added: quality, price and contract terms,] product and process improvements, specialized customer services, the ability to attract and retain skilled [removed: personnel] [added: personnel,] and the maintenance of a good safety record [removed: have also been important] [added: are the primary] factors to compete effectively in the catalysts marketplace.

We expect this change to provide further clarity into the performance of each business.

In addition, in December 2018, we purchased undeveloped land with access to a lithium resource in Antofalla, within the Catamarca Province of Argentina from Bolland Minera S.A. If necessary, we can also obtain lithium from other sources.

In December 2018, we entered into a definitive agreement to acquire a 50% interest in Mineral Resources Limited's Wodgina hard rock lithium mine project (“Wodgina Project”) and form a joint venture with Mineral Resources Limited to own and operate the Wodgina Project to produce spodumene concentrate and battery grade lithium hydroxide.

Under this agreement, we would jointly fund, design, build and operate a battery grade lithium hydroxide plant in stages at Wodgina, located in the Pilbara region of Western Australia.

This transaction is subject to regulatory approvals and other customary closing conditions, and is expected to close in the second half of 2019.

End market products that benefit from our fire safety technology include plastic

Catalysts Segment

We provide our customers with customized FCC catalyst systems.

Within our PCS product line, we manufacture organometallic co-catalysts (e.g., aluminum, magnesium and zinc alkyls) used in the manufacture of alpha-olefins (i.e., hexene, octene, decene), polyolefins (polyethylene and polypropylene) and electronics.

Competition in these markets is driven by a variety factors.

In December 2018, we entered into a definitive agreement to acquire a 50% interest in Mineral Resources Limited's Wodgina Project, located in the Pilbara region of Western Australia, and form a joint venture with Mineral Resources Limited to own and operate the Wodgina Project to produce spodumene concentrate and battery grade lithium hydroxide, for a purchase price of $1.15 billion.

This transaction is subject to regulatory approvals and other customary closing conditions, and is expected to close in the second half of 2019.

On April 3, 2018, we completed the Polyolefin Catalysts Divestiture to W.R. Grace & Co. for net cash proceeds of approximately $413.6 million.

The Chemetall Surface Treatment business was originally part of our previously reported 2015 acquisition of Rockwood Holdings, Inc. (“Rockwood”).

On January 12, 2015 (the “Acquisition Closing Date”), we completed the acquisition of Rockwood Holdings, Inc. (“Rockwood”) for a purchase price of approximately $5.7 billion.

As a result, Rockwood became a wholly-owned subsidiary of Albemarle.

During 2017, we managed and reported our operations under three reportable segments: Lithium and Advanced Materials, Bromine Specialties and Refining Solutions.

For financial information regarding our reportable segments, including revenues generated for each of the last three fiscal years from each of the product categories included in our reportable segments, and geographic area information, see Note 24, “Segment and Geographic Area Information,” to our consolidated financial statements included in Part II, Item 8 of this report.

As of December 31, 2017, our Lithium and Advanced Materials segment consisted of two product categories: Lithium and PCS.

Lithium.

We are a leading global provider of lithium compounds.

In addition, we have entered an agreement with Bolland Minera S.A. for the exclusive exploration and acquisition rights to a lithium resource in Antofalla, within the Catamarca Province of Argentina.

If necessary, we can also obtain lithium from other sources.

In 2016, we were granted approval by the Environmental Assessment Commission of the Antofagasta Region to increase our currently authorized lithium brine removal rate in the Salar de Atacama, in addition to amending our lithium production rights agreement with the Chilean Economic Development Agency (“CORFO”) to both extend the term of that agreement and increase our authorized lithium quota at our facility in the Salar de Atacama, Chile.

As a result of this development, we have requested that CORFO increase our lithium quota.

As of the date of this Annual Report, CORFO is yet to conclude on the Company’s request.

computers, mobile phones, electric bicycles and electric vehicles.

Performance Catalyst Solutions.

We have three significant product lines in our PCS division: organometallics, polymer catalysts and curatives.

We manufacture organometallic co-catalysts (e.g., aluminum, magnesium and zinc alkyls) as well as metallocene components and co-catalysts (e.g., methylaluminumoxane, organoborons, metallocene compounds, and finished polymerization catalysts comprising these products).

We also offer finished single-site catalysts with or without our proprietary ActivCat® activation technology and a line of proprietary Ziegler-Natta catalysts under the Advantage™ brand.

Our co-catalysts and finished catalysts are used in our customers’ production of polyolefin polymers.

Such polymers are commodity (i.e., Ziegler-Natta polymerization technology-based) and specialty (i.e., Single Site polymerization technology-based) plastics serving a wide variety of end markets including packaging, non-packaging, films and injection molding.

Some of our organometallic products are also used in the manufacture of alpha-olefins (i.e., hexene, octene, decene).

The sale is expected to close in the first quarter of 2018, subject to the satisfaction of customary closing conditions, including approvals from regulatory authorities.

PCS—Competition

Lonza is our main competitor in the curatives market.

PCS—Raw Materials and Significant Supply Contracts

The cost of raw materials is generally based on market prices, although we may use contracts with price caps or other tools, as appropriate, to mitigate price volatility.

Product performance and quality, price and contract terms are the primary factors in determining which qualified supplier is awarded a contract.

In addition, through our 50% interest in Jordan Bromine Company

Refining Solutions Segment

We offer a wide range of HPC products and provide customized FCC catalyst systems to our customers.

Our Refining Solutions segment serves the global market including the Americas, Asia, Europe and the Middle East, each of which is highly competitive and driven by different factors.

The major raw materials we use in our Refining Solutions operations include sodium silicate, sodium aluminate, kaolin, rare earths and metals such as molybdenum, nickel and cobalt, most of which are readily available from numerous independent suppliers and are purchased or provided under contracts at prices we believe are competitive.

product development.

We incurred research and development expenses of $84.3 million, $80.5 million and $89.2 million during 2017, 2016 and 2015, respectively.

On December 14, 2017, we signed a definitive agreement to sell the polyolefin catalysts and components portion of our PCS business to W.R. Grace & Co. for proceeds of approximately $416 million in cash.

On December 14, 2016, we completed the sale of the Chemetall Surface Treatment business, originally part of the acquisition of Rockwood, to BASF SE for cash proceeds of approximately $3.1 billion.

On January 12, 2015, we completed the acquisition of Rockwood for a purchase price of approximately $5.7 billion, with Rockwood becoming a wholly-owned subsidiary of Albemarle.

Through the acquisition of Rockwood, we became a leading integrated and low cost global producer of lithium and lithium compounds used in lithium-ion batteries for electronic devices, alternative transportation vehicles and energy storage technologies, meeting the significant growth in global demand for these products.

These reports may also be obtained at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, DC 20549.

[removed: Following] [added: As previously reported in 2018, following] receipt of information regarding potential improper payments being made by third party sales representatives of our Refining Solutions business, [added: within our Catalysts segment,] we promptly retained outside counsel and forensic accountants to investigate potential violations of the Company’s Code of Conduct, the FCPA, and other potentially applicable laws.

Based on this internal investigation, we have voluntarily self-reported potential issues relating to the use of third party sales representatives in our Refining Solutions [removed: business] [added: business, within our Catalysts segment,] to the [removed: U.S. DOJ and] [added: DOJ, the] SEC, and [removed: intend to cooperate] [added: DPP, and are cooperating] with the [removed: DOJ] [added: DOJ, the SEC,] and [removed: SEC] [added: DPP] in their review of these matters.

At this time, we are unable to predict the duration, scope, result or related costs associated with [removed: any] [added: the] investigations by the [removed: DOJ] [added: DOJ, the SEC,] or [removed: SEC.][added: DPP.]

We also are unable to predict what, if any, action may be taken by the [removed: DOJ or] [added: DOJ, the] SEC or [removed: what penalties] [added: DPP,] or [removed: remedial actions they may seek.][added: what]

Any determination that our operations or activities are not in compliance with existing laws or [removed: regulations, however,] [added: regulations] could result in the imposition of fines, penalties, disgorgement, equitable relief, or other losses.

We do not believe, however, that any [added: such] fines, penalties, disgorgement, equitable relief or other losses would have a material adverse effect on our financial condition or liquidity.

penalties or remedial actions they may seek to impose.

For the fiscal year ended December 31, [removed: 2017][added: 2018]

[removed: 4350] [added: 4250] Congress Street, Suite [removed: 700][added: 900]

The aggregate market value of the voting and non-voting common equity stock held by non-affiliates of the registrant was approximately [removed: $11.7] [added: $10.2] billion based on the last reported sale price of common stock on June 30, [removed: 2017,] [added: 2018,] the last business day of the registrant’s most recently completed second quarter.

Number of shares of common stock outstanding as of February 20, [removed: 2018: 110,638,449][added: 2019: 105,753,864]

Portions of Albemarle Corporation’s definitive Proxy Statement for its [removed: 2018] [added: 2019] Annual Meeting of Shareholders to be filed with the U.S. Securities and Exchange Commission pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended, are incorporated by reference into Part III of this Form 10-K.

Year Ended December 31, [removed: 2017][added: 2018]

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10-K 1 a1231201810-kdocument.htm 10-K

| [PART I](#s7312871EF7E110F229AA17D030B75D0B) | | |

| [PART II](#s19E5FF8BBF5FF4C9233117D03204A502) | | |

| [PART IV](#sD940F3DDB4903C3B88C117D03D693249) | | |

| | [Signatures](#s43961F6DAEA4189D668517D03DDE5906) | [121](#s43961F6DAEA4189D668517D03DDE5906) |

10-K 1 a1231201710-kdocument.htm 10-K

| [PART I](#s5F5AAF297E2F5E3AB878D8B01A49749C) | | |

| [PART II](#sDCF26996705452699BF5AF58E9AC3926) | | |

| [PART IV](#s75E77166F192500E92B2C14C370B294D) | | |

| | [Signatures](#sAEDB8AC49C67576BAFC2881EECC7EAE6) | [124](#sAEDB8AC49C67576BAFC2881EECC7EAE6) |

During [removed: 2017,] [added: 2018,] the Company’s manufacturing plants operated at approximately [removed: 73%] [added: 78%] capacity, in the aggregate.

| Location | | Business Segment [removed: in 2017] | | Principal Use | | Owned/Leased |

| Amsterdam, the Netherlands | | [removed: Refining Solutions(a)] [added: Catalysts] | | Production of refinery catalysts, research and product development activities | | Owned |

| Baton Rouge, Louisiana | | [removed: Lithium and Advanced Materials(b);] Bromine Specialties | | Research and product development activities, and production of flame [removed: retardants, catalysts and additives] [added: retardants] | | [removed: Owned; on leased land] [added: Leased] |

| Bitterfeld, Germany | | [removed: Refining Solutions(a)] [added: Catalysts] | | Refinery catalyst regeneration, rejuvenation, and sulfiding | | Owned by Eurecat S.A., a joint venture owned 50% by each of Axens Group and us |

| Greenbushes, Australia | | Lithium [removed: and Advanced Materials] | | Production of lithium spodumene minerals and lithium concentrate | | Owned by Windfield Holdings Pty Ltd, a joint venture in which we own 49%, and Sichuan Tianqi Lithium Industries Inc. which owns the remaining interest |

| Jubail, Saudi Arabia | | [removed: Lithium and Advanced Materials(a)] [added: Catalysts] | | Manufacturing and marketing of organometallics | | Owned by Saudi Organometallic Chemicals Company LLC, a joint venture owned 50% by each of Saudi Specialty Chemicals Company (a SABIC affiliate) and us |

| Kings Mountain, North Carolina | | Lithium [removed: and Advanced Materials] | | Production of technical and battery grade lithium hydroxide, lithium salts and battery grade lithium metal products | | Owned |

| La Negra, Chile | | Lithium [removed: and Advanced Materials] | | Production of lithium carbonate and lithium chloride | | Owned |

| Langelsheim, Germany | | Lithium [removed: and Advanced Materials] | | Production of butyllithium, lithium chloride, specialty products, lithium hydrides, cesium and special metals | | Owned |

| Louvain-la-Neuve, Belgium | | [removed: Lithium and Advanced Materials;] [added: Lithium;] Bromine Specialties; [removed: Refining Solutions(a);] [added: Catalysts;] All Other | | Regional offices and research and customer technical service activities | | Owned |

| La Voulte, France | | [removed: Refining Solutions(a)] [added: Catalysts] | | Refinery catalysts regeneration and treatment, research and development activities | | Owned by Eurecat S.A., a joint venture owned 50% by each of Axens Group and us |

| McAlester, Oklahoma | | [removed: Refining Solutions(a)] [added: Catalysts] | | Refinery catalyst regeneration, rejuvenation, pre-reclaim burn off, as well as specialty zeolites and additives marketing activities | | Owned by Eurecat S.A., a joint venture owned 50% by each of Axens Group and us |

| Meishan, China | | Lithium [removed: and Advanced Materials] | | Production of lithium carbonate and lithium hydroxide | | Owned |

| Mobile, Alabama | | [removed: Lithium and Advanced Materials(a)] [added: Catalysts] | | Production of tin stabilizers | | Owned by PMC Group, Inc. which operates the plant for Stannica LLC, a joint venture owned 50% by each of PMC Group Inc. and us |

| New Johnsonville, Tennessee | | Lithium [removed: and Advanced Materials] | | Production of specialty products | | Owned |

| Niihama, Japan | | [removed: Refining Solutions(a)] [added: Catalysts] | | Production of refinery catalysts | | Leased by Nippon Ketjen Company Limited, a joint venture owned 50% by each of Sumitomo Metal Mining Company Limited and us |

| Pasadena, Texas | | [removed: Lithium and Advanced Materials(a);] [added: Catalysts;] All Other | | Production of aluminum alkyls, alkenyl succinic anhydride, orthoalkylated anilines, and other specialty chemicals | | Owned |

| Pasadena, Texas | | [removed: Refining Solutions(a)] [added: Catalysts] | | Production of refinery catalysts, research and development activities | | Owned |

| Pasadena, Texas | | [removed: Refining Solutions(a)] [added: Catalysts] | | Refinery catalysts regeneration services | | Owned by Eurecat U.S. Incorporated, a joint venture in which we own a 57.5% interest and a consortium of entities in various proportions owns the remaining interest |

| Salar de Atacama, Chile | | Lithium [removed: and Advanced Materials] | | Production of lithium brine and potash | | Owned; however ownership will revert to the Chilean government once we have sold all remaining amounts under our contract with the Chilean government pursuant to which we obtain lithium brine in Chile |

| Santa Cruz, Brazil | | [removed: Refining Solutions(a)] [added: Catalysts] | | Production of catalysts, research and product development activities | | Owned by Fábrica Carioca de Catalisadores S.A, a joint venture owned 50% by each of Petrobras Química S.A.—PETROQUISA and us |

| Silver Peak, Nevada | | Lithium [removed: and Advanced Materials] | | Production of lithium brine and lithium carbonate | | Owned |

| Taichung, Taiwan | | Lithium [removed: and Advanced Materials] | | Production of butyllithium | | Owned |

| Takaishi City, Osaka, Japan | | [removed: Lithium and Advanced Materials(a)] [added: Catalysts] | | Production of aluminum alkyls | | Owned by Nippon Aluminum Alkys, a joint venture owned 50% by each of Mitsui Chemicals, Inc. and us |

| Xinyu, China | | Lithium [removed: and Advanced Materials] | | Production of lithium carbonate and lithium hydroxide | | Owned |

| Location | | Business Segment | | Principal Use | | Owned/Leased |

| Location | | Business Segment | | Principal Use | | Owned/Leased |

| | | | | | | |

| Cambridge, U.K. | | Lithium and Advanced Materials(a) | | Production of performance catalysts | | Leased |

| Yeosu, South Korea | | Lithium and Advanced Materials(b) | | Research and product development activities/small scale production of catalysts and catalyst components | | Owned |

| | |

| --- | --- |

| (a) | During the first quarter of 2018, the PCS product category will merge with the Refining Solutions reportable segment to form the Catalysts reportable segment, a global business focused on catalysts. These significant production facilities will be part of the Catalysts reportable segment beginning in 2018. |

| (b) | Facility included in the sale of the polyolefin catalysts and components portion of the PCS business, which is expected to close in the first quarter of 2018. |

The names, ages and biographies of our executive officers, as of February 20, [removed: 2018,] [added: 2019,] are set forth below.

The term of office of each officer is until the meeting of the Board of Directors following the next annual shareholders’ meeting (May [removed: 8, 2018).][added: 7, 2019).]

| Luther C. Kissam IV | | [removed: 53] [added: 54] | | Chairman, President and Chief Executive Officer |

| Karen G. Narwold | | [removed: 58] [added: 59] | | Executive Vice President, Chief Administrative [removed: Officer] [added: Officer, Corporate Secretary] |

| Scott A. Tozier | | [removed: 52] [added: 53] | | Executive Vice President, Chief Financial Officer |

| Donald J. LaBauve, Jr. | | [removed: 51] [added: 52] | | Vice President, Corporate Controller, Chief Accounting Officer |

Narwold joined us in September of 2010 and currently serves as Executive Vice [removed: President and] [added: President,] Chief Administrative [removed: Officer.][added: Officer, General Counsel and Corporate Secretary.]

After five years in private practice, she served as Vice President, General Counsel, Human Resources and Secretary of GrafTech International Ltd., a global graphite and carbon manufacturer and former subsidiary of Union [added: Carbide.]

Most recently, Mr. Tozier served as Vice President of Finance, Operations and Transformation of Honeywell International, Inc. [added: Mr. Tozier has served as a member of the board of directors of Garrett Motion Inc. since October 2018.]

LaBauve Jr. was elected Vice President, Corporate Controller effective February 2013, and Chief Accounting Officer effective February 2014, after having previously served as Vice President, Finance - Business Operations since April [removed: 2009.]

Since joining the Company [removed: as Ethyl Corporation] in [removed: April] 1990, Mr. LaBauve has held various staff and leadership positions of increasing responsibility within the finance function, including an assignment to our European headquarters in Belgium in April 2000, where he held the regional finance leadership role from July 2002 through June 2005.

Mr. Kissam serves on the Advisory Committee of the Specialty Products Division at DowDupont since June 2018.

Ms. Narwold was appointed as a member of the Board of Directors of Ingevity Corporation on February 20, 2019.

2009.

| Matthew K. Juneau | | 57 | | Executive Vice President, Corporate Strategy and Investor Relations |

Matthew K.

Juneau was elected as our Executive Vice President of Corporate Strategy and Investor Relations effective May 2015.

On January 17, 2018, Mr. Juneau gave notice of his decision to retire from the Company in March 2018 following over 35 years of service.

Previously, Mr. Juneau served as Senior Vice President, President Performance Chemicals since December 2013, Vice President, Polymer Solutions since March 2012, Vice President, Global Sales and Services from May 2009 to February 2012, and prior to that as Division Vice President of our performance chemicals business in the Fine Chemistry division since January 2007.

Prior to that, Mr. Juneau held various positions of increasing responsibility in research and development and business management with us including Managing Director of our European operations from January 2003 until December 2007.

Mr. Juneau joined us as a chemical engineer in June 1982.

Carbide.

On February [removed: 23, 2018,] [added: 26, 2019,] we declared a dividend of [removed: $0.335] [added: $0.3675] per share of common stock, payable April [removed: 2, 2018.][added: 1, 2019.]

The graph below shows the cumulative total shareholder return assuming the investment of $100 in our common stock on December 31, [removed: 2012] [added: 2013] and the reinvestment of all dividends thereafter.

[removed: ][added: ]

Our common stock trades on the New York Stock Exchange (“NYSE”) under the symbol “ALB.” There were 105,753,864 shares of common stock held by 2,444 shareholders of record as of February 20, 2019.

The following table summarizes our repurchases of equity securities for the three-month period ended December 31, 2018:

| | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | |

| Period | | Total Number of Shares Repurchased | | | Average Price Paid Per Share | | | | Total Number of Shares Repurchased as Part of Publicly Announced Plans or Programs(a) | | | Maximum Number of Shares that May Yet Be Repurchased Under the Plans or Programs | |

| October 1, 2018 to October 31, 2018 | | — | | | $ | — | | | — | | | 7,993,299 | |

| November 1, 2018 to November 30, 2018 | | — | | | — | | | | — | | | 7,993,299 | |

| December 1, 2018 to December 31, 2018(b) | | 597,036 | | | 96.83 | | | | 597,036 | | | 7,396,263 | |

| Total | | 597,036 | | | | | | | 597,036 | | | | |

| (a) | Our stock repurchase plan, which was authorized by our Board of Directors, permits the Company to repurchase up to a maximum of 15,000,000 shares. The stock repurchase plan will expire when we have repurchased all shares authorized for repurchase thereunder, unless the stock repurchase plan is earlier terminated by action of our Board of Directors or further shares are authorized for repurchase. |

| --- | --- |

| (b) | In the third quarter of 2018, we paid $250 million under the accelerated share repurchase (“ASR”) agreement. Under the terms of the agreement, in December 2018, the ASR agreement was completed and we received and retired a final settlement of 597,036 shares. The Average Price Paid Per Share was calculated using the daily Rule 10b-18 volume-weighted average prices of our common stock over the term of the ASR agreement, less an agreed discount. See Note 5, “Earnings Per Share,” to our consolidated financial statements included in Part II, Item 8 of this report. |

| | |

| --- | --- |

| | |

Our common stock trades on the New York Stock Exchange (“NYSE”) under the symbol “ALB.” The following table sets forth on a per share basis the high and low sales prices for our common stock for the periods indicated, as reported on the NYSE composite transactions reporting system, and the dividends declared per share on our common stock.

| | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | Common Stock Price Range | | | | | | | | Dividends Declared Per Share of Common Stock | | |

| | High | | | | Low | | | | | | |

| 2016 | | | | | | | | | | | |

| First Quarter | $ | 64.33 | | | $ | 45.78 | | | $ | 0.305 | |

| Second Quarter | $ | 84.99 | | | $ | 63.40 | | | $ | 0.305 | |

| Third Quarter | $ | 87.29 | | | $ | 75.11 | | | $ | 0.305 | |

| Fourth Quarter | $ | 92.24 | | | $ | 76.32 | | | $ | 0.305 | |

| 2017 | | | | | | | | | | | |

| First Quarter | $ | 107.56 | | | $ | 86.98 | | | $ | 0.32 | |

| Second Quarter | $ | 116.64 | | | $ | 103.42 | | | $ | 0.32 | |

| Third Quarter | $ | 137.48 | | | $ | 105.34 | | | $ | 0.32 | |

| Fourth Quarter | $ | 144.99 | | | $ | 126.31 | | | $ | 0.32 | |

There were 110,638,449 shares of common stock held by 2,532 shareholders of record as of February 20, 2018.

The information required by Item 201(d) of Regulation S-K is contained in our definitive Proxy Statement for our 2018 Annual Meeting of Shareholders to be filed with the SEC pursuant to Regulation 14A under the Exchange Act, or the Proxy Statement, and is incorporated herein by reference.

The information for the five years ended December 31, [removed: 2017,] [added: 2018,] is contained in the “Five-Year Summary” included in Part IV, Item 15, Exhibit 99.1 and incorporated herein by reference.

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, [removed: 2017.][added: 2018.]

Based on the assessment, management concluded that, as of December 31, [removed: 2017,] [added: 2018,] our internal control over financial reporting was effective to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States.

The effectiveness of our internal control over financial reporting as of December 31, [removed: 2017] [added: 2018] has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included herein.

To the Board of Directors and Shareholders of Albemarle [removed: Corporation][added: Corporation:]

We have audited the accompanying consolidated balance sheets of Albemarle Corporation and its subsidiaries [removed: (or “the Company”)] [added: (the “Company”)] as of December 31, [removed: 2017] [added: 2018] and [removed: December 31, 2016,] [added: 2017,] and the related consolidated statements of income, comprehensive income (loss), changes in equity and cash flows for each of the three years in the period ended December 31, [removed: 2017,] [added: 2018,] including the related notes (collectively referred to as the “consolidated financial statements”).

We [removed: have] also [added: have] audited the Company’s internal control over financial reporting as of December 31, [removed: 2017,] [added: 2018,] based on criteria established in Internal Control—Integrated Framework [removed: 2013] [added: (2013)] issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2017] [added: 2018] and [removed: December 31, 2016,] [added: 2017,] and the results of [removed: their] [added: its] operations and [removed: their] [added: its] cash flows for each of the three years in the period ended December 31, [removed: 2017] [added: 2018] in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2017,] [added: 2018,] based on criteria established in Internal Control—Integrated Framework [removed: 2013] [added: (2013)] issued by the COSO.

Our responsibility is to express opinions on the Company’s [added: consolidated] financial statements and on the Company’s internal control over financial reporting based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) [removed: (“PCAOB)] [added: (PCAOB)] and are required to be independent with respect to the Company in accordance with [added: the] U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the [removed: company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.]

| Year Ended December 31 | [removed: 2017] [added: 2018] | | | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | |

| Net sales | $ | [removed: 3,071,976] [added: 3,374,950] | | | $ | [removed: 2,677,203] [added: 3,071,976] | | | $ | [removed: 2,826,429] [added: 2,677,203] | |

| Research and development expenses | [removed: 84,330] [added: 70,054] | | | | [removed: 80,475] [added: 84,330] | | | | [removed: 89,187] [added: 80,475] | | |

| Restructuring and [removed: other, net] [added: other(a)] | — | | | | — | | | | [removed: (6,804] [added: —] | | [removed: )] | [added: | — | | | | — | | | | 3,838 | | | | 3,838 | | |]

| Gain on sales of businesses, net | [removed: —] [added: (210,428] | | [added: )] | | [removed: (122,298] [added: —] | | [removed: )] | | [removed: —] [added: (122,298] | | [added: )] |

| Acquisition and integration related costs | — | | | | [removed: 57,384] [added: —] | | | | [removed: 132,299] [added: 57,384] | | |

| Interest and financing expenses | [removed: (115,350] [added: (52,405] | | ) | | [removed: (65,181] [added: (115,350] | | ) | | [removed: (81,650] [added: (65,181] | | ) |

| Income from continuing operations before income taxes and equity in net income of unconsolidated investments | [removed: 446,798] [added: 794,701] | | | | [removed: 515,264] [added: 446,798] | | | | [removed: 310,744] [added: 515,264] | | |

| Income tax expense | [removed: 431,817] [added: 144,826] | | | | [removed: 96,263] [added: 431,817] | | | | [removed: 11,134] [added: 96,263] | | |

| Income from continuing operations before equity in net income of unconsolidated investments | [removed: 14,981] [added: 649,875] | | | | [removed: 419,001] [added: 14,981] | | | | [removed: 299,610] [added: 419,001] | | |

| Equity in net income of unconsolidated investments (net of tax) | [removed: 84,487] [added: 89,264] | | | | [removed: 59,637] [added: 84,487] | | | | [removed: 27,978] [added: 59,637] | | |

| Net income from continuing operations | [removed: 99,468] [added: 739,139] | | | | [removed: 478,638] [added: 99,468] | | | | [removed: 327,588] [added: 478,638] | | |

| Income from discontinued operations (net of tax) | — | | | | [removed: 202,131] [added: —] | | | | [removed: 32,476] [added: 202,131] | | |

| Net income | [removed: 99,468] [added: 739,139] | | | | [removed: 680,769] [added: 99,468] | | | | [removed: 360,064] [added: 680,769] | | |

| Net income attributable to noncontrolling interests | [removed: (44,618] [added: (45,577] | | ) | | [removed: (37,094] [added: (44,618] | | ) | | [removed: (25,158] [added: (37,094] | | ) |

| Net income attributable to Albemarle Corporation | $ | [removed: 54,850] [added: 693,562] | | | $ | [removed: 643,675] [added: 54,850] | | | $ | [removed: 334,906] [added: 643,675] | |

| Continuing operations | $ | [removed: 0.49] [added: 6.40] | | | $ | [removed: 3.93] [added: 0.49] | | | $ | [removed: 2.72] [added: 3.93] | |

| Discontinued operations | — | | | | [removed: 1.80] [added: —] | | | | [removed: 0.29] [added: 1.80] | | |

| | $ | [removed: 0.49] [added: 6.40] | | | $ | [removed: 5.73] [added: 0.49] | | | $ | [removed: 3.01] [added: 5.73] | |

| Continuing operations | $ | [removed: 0.49] [added: 6.34] | | | $ | [removed: 3.90] [added: 0.49] | | | $ | [removed: 2.71] [added: 3.90] | |

| Discontinued operations | — | | | | [removed: 1.78] [added: —] | | | | [removed: 0.29] [added: 1.78] | | |

| | $ | [removed: 0.49] [added: 6.34] | | | $ | [removed: 5.68] [added: 0.49] | | | $ | [removed: 3.00] [added: 5.68] | |

| Weighted-average common shares outstanding—basic | [removed: 110,914] [added: 108,427] | | | | [removed: 112,379] [added: 110,914] | | | | [removed: 111,182] [added: 112,379] | | |

| Weighted-average common shares outstanding—diluted | [removed: 112,380] [added: 109,458] | | | | [removed: 113,239] [added: 112,380] | | | | [removed: 111,556] [added: 113,239] | | |

| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [removed: (LOSS)] | | |

| Net income | $ | [removed: 99,468] [added: 739,139] | | | $ | [removed: 680,769] [added: 99,468] | | | $ | [removed: 360,064] [added: 680,769] | |

| Other comprehensive [removed: income (loss),] [added: (loss) income,] net of tax: | | | | | | | | | | | |

| Foreign currency translation | [removed: 227,439] [added: (150,258] | | [added: )] | | [removed: (20,825] [added: 227,439] | | [removed: )] | | [removed: (412,970] [added: (20,825] | | ) |

| Pension and postretirement benefits | [removed: (97] [added: (138] | | ) | | [removed: 834] [added: (97] | | [added: )] | | [removed: (758] [added: 834] | | [removed: )] |

| February 27, 2019 |

Change in Accounting Principle

As discussed in Note 1 to the consolidated financial statements, the Company changed the manner in which it accounts for revenues from contracts with customers in 2018.

company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

| Charlotte, North Carolina |

| February 27, 2019 |

| Cost of goods sold | 2,157,694 | | | | 1,965,700 | | | | 1,706,897 | | |

| Gross profit | 1,217,256 | | | | 1,106,276 | | | | 970,306 | | |

| Selling, general and administrative expenses | 446,090 | | | | 450,286 | | | | 353,765 | | |

| Operating profit | 911,540 | | | | 571,660 | | | | 600,980 | | |

| Other expenses, net | (64,434 | | ) | | (9,512 | | ) | | (20,535 | | ) |

| December 31 | 2018 | | | | 2017 | | |

| Cash and cash equivalents | $ | 555,320 | | | $ | 1,137,303 | |

| Goodwill | 1,567,169 | | | | 1,610,355 | | |

| Total assets | $ | 7,581,674 | | | $ | 7,750,772 | |

| Balance at January 1, 2018 | | 110,546,674 | | | $ | 1,105 | | | $ | 1,863,949 | | | $ | (225,668 | ) | | $ | 2,035,163 | | | $ | 3,674,549 | | | $ | 143,147 | | | $ | 3,817,696 | |

| Net income | | | | | | | | | | | | | | | | | 693,562 | | | | 693,562 | | | | 45,577 | | | | 739,139 | | |

| Other comprehensive loss | | | | | | | | | | | | | (125,014 | | ) | | | | | | (125,014 | | ) | | (181 | | ) | | (125,195 | | ) |

| Cash dividends declared, $1.34 per common share | | | | | | | | | | | | | | | | | (144,601 | | ) | | (144,601 | | ) | | (14,756 | | ) | | (159,357 | | ) |

| Cumulative adjustments from adoption of income tax standard updates (Note 1) | | | | | | | | | | | | | | | | | (18,074 | | ) | | (18,074 | | ) | | | | | | (18,074 | | ) |

| Exercise of stock options | | 94,031 | | | 1 | | | | 3,632 | | | | | | | | | | | | 3,633 | | | | | | | | 3,633 | | |

| Shares repurchased | | (5,262,654 | ) | | (53 | | ) | | (499,947 | | ) | | | | | | | | | | (500,000 | | ) | | | | | | (500,000 | | ) |

| Balance at December 31, 2018 | | 105,616,028 | | | $ | 1,056 | | | $ | 1,368,897 | | | $ | (350,682 | ) | | $ | 2,566,050 | | | $ | 3,585,321 | | | $ | 173,787 | | | $ | 3,759,108 | |

| Net income | 739,139 | | | | 99,468 | | | | 680,769 | | |

Effective January 1, 2018, we adopted Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers” and all related amendments using the modified retrospective method.

There was no material impact to our results of operations or financial position upon adoption, and no adjustment was made to Retained earnings in our consolidated balance sheets because such adjustment was determined to be immaterial.

In addition, new presentation requirements, including separate disclosure of net sales from sources other than customers on our consolidated statements of income and separate disclosures of contract assets or liabilities on our consolidated balance sheets, generally did not have a material impact.

However, business circumstances, including the nature of customer contracts, can change and as such, we have expanded processes and controls to recognize such changes, and as necessary, consider whether any of these currently immaterial items might differ in the future.

Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services, and is recognized when performance obligations are satisfied under the terms of contracts with our customers.

A performance obligation is deemed to be satisfied when control of the product or service is transferred to our customer.

The transaction price of a contract, or the amount we expect to receive upon satisfaction of all performance obligations, is determined by reference to the contract’s terms and includes adjustments, if applicable, for any variable consideration, such as customer rebates, noncash consideration or consideration payable to the customer, although these adjustments are generally not material.

Where a contract contains more than one distinct performance obligation, the transaction price is allocated to each performance obligation based on the standalone selling price of each performance obligation, although these situations do not

occur frequently and are generally not built into our contracts.

Any unsatisfied performance obligations are not material.

Standalone selling prices are based on prices we charge to our customers, which in some cases is based on established market prices.

Sales and other similar taxes collected from customers on behalf of third parties are excluded from revenue.

Our payment terms are generally between 30 to 90 days, however, they vary by market factors, such as customer size, creditworthiness, geography and competitive environment.

All of our revenue is derived from contracts with customers, and almost all of our contracts with customers contain one performance obligation for the transfer of goods where such performance obligation is satisfied at a point in time.

Control of a product is deemed to be transferred to the customer upon shipment or delivery.

Costs for shipping and handling activities, whether performed before or after the customer obtains control of the goods, are accounted for as fulfillment costs.

| February 27, 2018 |

| | | |

| --- | --- | --- |

| Albemarle Corporation and Subsidiaries | | |

| New Orleans, Louisiana |

| | | | | | | | | | | | |

| Cost of goods sold | 1,961,996 | | | | 1,706,627 | | | | 1,966,196 | | |

| Gross profit | 1,109,980 | | | | 970,576 | | | | 860,233 | | |

| Selling, general and administrative expenses | 437,901 | | | | 380,464 | | | | 300,440 | | |

| Operating profit | 587,749 | | | | 574,551 | | | | 345,111 | | |

| Other (expenses) income, net | (25,601 | | ) | | 5,894 | | | | 47,283 | | |

| Cash dividends declared per share of common stock | $ | 1.28 | | | $ | 1.22 | | | $ | 1.16 | |

| | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- |

| Balance at January 1, 2015 | | 78,030,524 | | | $ | 780 | | | $ | 10,447 | | | $ | (62,413 | ) | | $ | 1,410,651 | | | $ | 1,359,465 | | | $ | 129,170 | | | $ | 1,488,635 | |

| Net income | | | | | | | | | | | | | | | | | 334,906 | | | | 334,906 | | | | 25,158 | | | | 360,064 | | |

| Other comprehensive loss | | | | | | | | | | | | | (358,875 | | ) | | | | | | (358,875 | | ) | | (1,891 | | ) | | (360,766 | | ) |

| Cash dividends declared | | | | | | | | | | | | | | | | | (130,150 | | ) | | (130,150 | | ) | | (23,286 | | ) | | (153,436 | | ) |

| Exercise of stock options | | 18,000 | | | — | | | | 517 | | | | | | | | | | | | 517 | | | | | | | | 517 | | |

| Tax deficiency related to stock plans | | | | | | | | | (167 | | ) | | | | | | | | | | (167 | | ) | | | | | | (167 | | ) |

| Acquisition of Rockwood | | 34,113,064 | | | 341 | | | | 2,036,209 | | | | | | | | | | | | 2,036,550 | | | | 17,582 | | | | 2,054,132 | | |

| Noncontrolling interest assumed in acquisition of Shanghai Chemetall | | | | | | | | | | | | | | | | | | | | | — | | | | 4,843 | | | | 4,843 | | |

| Purchase of noncontrolling interest | | | | | | | | | | | | | | | | | | | | | — | | | | (4,655 | | ) | | (4,655 | | ) |

| Balance at December 31, 2015 | | 112,219,351 | | | $ | 1,122 | | | $ | 2,059,151 | | | $ | (421,288 | ) | | $ | 1,615,407 | | | $ | 3,254,392 | | | $ | 146,921 | | | $ | 3,401,313 | |

| Cash and cash equivalents at beginning of year | $ | 2,269,756 | | | $ | 213,734 | | | $ | 2,489,768 | |

| Gain associated with restructuring and other | — | | | | — | | | | (6,804 | | ) |

| Acquisition of Rockwood, net of cash acquired | — | | | | — | | | | (2,051,645 | | ) |

| Decrease in restricted cash | — | | | | — | | | | 57,550 | | |

| Return of capital from unconsolidated investment | — | | | | — | | | | 98,000 | | |

| Purchase of noncontrolling interest | — | | | | — | | | | (4,784 | | ) |

| Debt financing costs | — | | | | — | | | | (4,544 | | ) |

| Other | — | | | | — | | | | (3,882 | | ) |

| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | | |

As described further in Note 2, “Acquisitions,” we completed our acquisition of Rockwood Holdings, Inc. (“Rockwood”) on January 12, 2015.

The consolidated financial statements contained herein include the results of operations of Rockwood, commencing on January 13, 2015.

We recognize sales when the revenue is realized or realizable, and has been earned, in accordance with authoritative accounting guidance.

We recognize net sales as risk and title to the product transfer to the customer, which usually occurs at the time shipment is made.

We recognize revenue from services when performance of the services has been completed.

Where the Company incurs pre-production design and development costs under long-term supply contracts, these costs are expensed where they relate to the products sold unless contractual guarantees for reimbursement exist.

Conversely, these costs are capitalized if they pertain to equipment that we will own and use in producing the products to be supplied and expect to utilize for future revenue generating activities.

Our management assessed the effectiveness of our internal control over financial reporting as of December 31, [removed: 2017.][added: 2018.]

Based on the assessment, management concluded that, as of December 31, [removed: 2017,] [added: 2018,] our internal control over financial reporting was effective based on those criteria.

The effectiveness of our internal control over financial reporting as of December 31, [removed: 2017] [added: 2018] has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report, which is included herein.

No change in our internal control over financial reporting (as such term is defined in Exchange Act Rule 13a-15(f)) occurred during the fiscal quarter ended December 31, [removed: 2017] [added: 2018] that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

NONE

As disclosed in this Report under “Business -- Legal Proceedings," following receipt of information regarding potential improper payments being made by third party sales representatives of our Refining Solutions business, we promptly retained outside counsel and forensic accountants to investigate potential violations of our Code of Conduct, the Foreign Corrupt Practices Act and other potentially applicable laws.

Based on this internal investigation, we voluntarily self-reported potential issues relating to the use of third party sales representatives in our Refining Solutions business to the DOJ and the SEC and intend to cooperate with the DOJ and the SEC in their review of these matters.

Our Board of Directors has determined, as a prudent governance measure while the investigation is pending, to condition payment of each Named Executive Officer’s (as defined below) cash incentive bonus for the fiscal year 2017 (the “2017 cash incentive”) on each Named Executive Officer executing a clawback agreement applicable to the 2017 cash incentive.

Accordingly, on February 26, 2018, the Company entered into a clawback agreement with each of Ms. Narwold and Messrs.

Kissam, Tozier, Juneau and LaBauve (each a "Named Executive Officer").

The clawback agreements supplement the Company’s existing clawback policy and provide that each Named Executive Officer's 2017 cash incentive is subject to clawback by the Company in the event that the Executive Compensation Committee of the Board determines that, with respect to the Company’s internal investigation or the government’s review of these matters following such self-report, the Named Executive Officer: (1) engaged in unlawful conduct or misconduct; (2) failed to cooperate in any related investigation; (3) violated the Company’s Code of Conduct or any other Company policy; or (4) failed to exercise appropriate supervision or oversight.

| | | |

| --- | --- | --- |

| Albemarle Corporation and Subsidiaries | | |

Disclosure of Certain Activities Under Section 13(r) of the Exchange Act

Section 13(r) of the Exchange Act requires an issuer to disclose whether it or any of its affiliates knowingly engaged in certain activities relating to Iran or with individuals or entities that are subject to certain sanctions under U.S. law.

Disclosure is required even where the activities, transactions or dealings are conducted outside of the United States in compliance with applicable law, and whether or not the activities are sanctionable under U.S. law.

All of our activities relating to Iran during the year ended December 31, 2017, as disclosed below, were conducted by one of our non-U.S. subsidiaries in our Refining Solutions segment (the “Specified Subsidiary”) pursuant to, and in compliance with, the terms and conditions of U.S. Treasury’s Office of Foreign Assets Control’s (OFAC) General License H.

In the year ended December 31, 2017, the Specified Subsidiary engaged in sales of the following items to counterparties in Iran’s oil, gas and/or petrochemical sectors:

| | |

| --- | --- |

| • | Sold approximately 794,458 kilograms of hydro-processing catalyst. The gross revenue and estimated net income before income taxes were approximately $5.7 million and $0.8 million, respectively. |

| • | Sold one Ketjen Catalyst Addition Unit Catalyst Loader. The gross revenue and estimated net income before income taxes were approximately $181,000 and $7,000, respectively. |

| • | Sold approximately 5,040 kilograms of oxychlorination catalyst. The gross revenue and estimated net income before income taxes were approximately $230,000 and $168,000, respectively. |

We do not intend to continue doing such business in Iran.

The Albemarle Code of Conduct is available on our [removed: website at http://www.albemarle.com.][added: website, www.albemarle.com.]

Shareholders may also request a free copy of the Albemarle Code of Conduct from: Albemarle Corporation, Attention: Investor Relations, [removed: 4350] [added: 4250] Congress Street, Suite [removed: 700,] [added: 900,] Charlotte, North Carolina 28209.

Our Chief Executive Officer made his annual certification to that effect to the NYSE as of [removed: May 24, 2017.][added: June 7, 2018.]

| | | |

| --- | --- | --- |

| | | |

| Albemarle Corporation and Subsidiaries | | |

| | | |

| | | |

| --- | --- | --- |

| Albemarle Corporation and Subsidiaries | | |

| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | | |

(a)(1) The following consolidated financial and informational statements of the registrant are included in Part II Item 8 on pages [removed: 57] [added: 58] to [removed: 115:][added: 113:]

Consolidated Balance Sheets as of December 31, [removed: 2017] [added: 2018] and [removed: 2016][added: 2017]

Consolidated Statements of Income, Comprehensive [removed: Income (Loss),] [added: Income,] Changes in Equity and Cash Flows for the years ended December 31, [removed: 2017, 2016] [added: 2018, 2017] and [removed: 2015][added: 2016]

| [2.1](http://www.sec.gov/Archives/edgar/data/915913/000119312514272361/d758511dex21.htm) | | [Agreement and Plan of Merger, dated as of July 15, 2014, among Albemarle Corporation, Albemarle Holdings Corporation and Rockwood Holdings, Inc. \[filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K (No. 1-12658) filed on July 18, 2014, and incorporated herein by [removed: reference\].](#s992F0D5706E05B8BACCB1535E84395C0)] [added: reference\].](#s2CC906191A87F0A78C9317D03D8CE8DD)] |

| [removed: [3.2](http://www.sec.gov/Archives/edgar/data/915913/000094787115000024/ss412125_ex0302.htm)] [added: [3.3](http://www.sec.gov/Archives/edgar/data/915913/000119312517168690/d586786dex32.htm)] | | [Amended and Restated Bylaws, effective [removed: January] [added: May] 12, [removed: 2015,] [added: 2017,] of Albemarle Corporation \[filed as Exhibit 3.2 to the Company’s Current Report on Form 8-K (No. 1-12658) filed on [removed: January] [added: May] 12, [removed: 2015,] [added: 2017,] and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000094787115000024/ss412125_ex0302.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312517168690/d586786dex32.htm)] |

| [removed: [3.3](http://www.sec.gov/Archives/edgar/data/915913/000119312517168690/d586786dex31.htm)] [added: [3.2](http://www.sec.gov/Archives/edgar/data/915913/000119312517168690/d586786dex31.htm)] | | [Amended and Restated Articles of Incorporation of Albemarle Corporation \[filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K (No. 1-12658) filed on May 12, 2017, and incorporated herein by reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312517168690/d586786dex31.htm) |

| [removed: [3.4](http://www.sec.gov/Archives/edgar/data/915913/000119312517168690/d586786dex32.htm)] [added: [#10.26](http://www.sec.gov/Archives/edgar/data/915913/000119312506255273/dex109.htm)] | | [Amended and Restated [removed: Bylaws, effective May 12, 2017, of] Albemarle Corporation [added: Benefits Protection Trust, effective as of December 13, 2006] \[filed as Exhibit [removed: 3.2] [added: 10.9] to the Company’s Current Report on Form 8-K (No. 1-12658) filed on [removed: May 12, 2017,] [added: December 18, 2006,] and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312517168690/d586786dex32.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312506255273/dex109.htm)] |

| [removed: [#10.4](http://www.sec.gov/Archives/edgar/data/915913/000119312513074383/d490736dex102.htm)] [added: [#10.4](http://www.sec.gov/Archives/edgar/data/915913/000119312513074383/d490736dex101.htm)] | | [Notice of [removed: Performance Unit Award] [added: Option Grant] \[filed as Exhibit [removed: 10.2] [added: 10.1] to the Company’s Current Report on Form 8-K (No. 1-12658) filed on February 25, 2013, and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312513074383/d490736dex102.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312513074383/d490736dex101.htm)] |

| [removed: [#10.5](http://www.sec.gov/Archives/edgar/data/915913/000119312513074383/d490736dex103.htm)] [added: [#10.8](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex102.htm)] | | [Notice of Restricted Stock Unit Award \[filed as Exhibit [removed: 10.3] [added: 10.2] to the Company’s Current Report on Form 8-K (No. 1-12658) filed on [removed: February 25, 2013,] [added: March 2, 2016,] and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312513074383/d490736dex103.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex102.htm)] |

| [removed: [#10.6](http://www.sec.gov/Archives/edgar/data/915913/000119312513074383/d490736dex101.htm)] [added: [#10.5](http://www.sec.gov/Archives/edgar/data/915913/000119312514077367/d688040dex101.htm)] | | [Notice of Option Grant \[filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K (No. 1-12658) filed on February [removed: 25, 2013,] [added: 28, 2014,] and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312513074383/d490736dex101.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312514077367/d688040dex101.htm)] |

| [removed: [#10.7](http://www.sec.gov/Archives/edgar/data/915913/000119312514077367/d688040dex104.htm)] [added: [#10.9](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex103.htm)] | | [Notice of [removed: Performance-Based Restricted Stock] [added: TSR Performance] Unit Award \[filed as Exhibit [removed: 10.4] [added: 10.3] to the Company’s Current Report on Form 8-K (No. 1-12658) filed on [removed: February 28, 2014,] [added: March 2, 2016,] and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312514077367/d688040dex104.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex103.htm)] |

| [removed: [#10.8](http://www.sec.gov/Archives/edgar/data/915913/000119312514077367/d688040dex103.htm)] [added: [#10.15](http://www.sec.gov/Archives/edgar/data/915913/000091591318000023/exhibit1030331201810q.htm)] | | [Notice of Restricted Stock Unit Award \[filed as Exhibit 10.3 to the Company’s [removed: Current] [added: Quarterly] Report on Form [removed: 8-K] [added: 10-Q] (No. 1-12658) filed on [removed: February 28, 2014,] [added: May 9, 2018,] and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312514077367/d688040dex103.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000091591318000023/exhibit1030331201810q.htm)] |

| [removed: [#10.9](http://www.sec.gov/Archives/edgar/data/915913/000119312514077367/d688040dex101.htm)] [added: [#10.7](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex101.htm)] | | [Notice of Option Grant \[filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K (No. 1-12658) filed on [removed: February 28, 2014,] [added: March 2, 2016,] and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312514077367/d688040dex101.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex101.htm)] |

| [removed: [#10.10](http://www.sec.gov/Archives/edgar/data/915913/000119312514077367/d688040dex102.htm)] [added: [#10.13](http://www.sec.gov/Archives/edgar/data/915913/000091591318000023/exhibit1010331201810q.htm)] | | [Notice of TSR Performance Unit Award \[filed as Exhibit [removed: 10.2] [added: 10.1] to the Company’s [removed: Current] [added: Quarterly] Report on Form [removed: 8-K] [added: 10-Q] (No. 1-12658) filed on [removed: February 28, 2014,] [added: May 9, 2018,] and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312514077367/d688040dex102.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000091591318000023/exhibit1010331201810q.htm)] |

| [removed: [#10.11](http://www.sec.gov/Archives/edgar/data/915913/000093244015000086/ex10-1_483393.htm)] [added: [#10.6](http://www.sec.gov/Archives/edgar/data/915913/000093244015000086/ex10-1_483393.htm)] | | [Notice of Option Grant \[filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K (No. 1-12658) filed on March 2, 2015, and incorporated herein by reference\].](http://www.sec.gov/Archives/edgar/data/915913/000093244015000086/ex10-1_483393.htm) |

| [removed: [#10.12](http://www.sec.gov/Archives/edgar/data/915913/000093244015000086/ex10-2_483894.htm)] [added: [#10.12](http://www.sec.gov/Archives/edgar/data/915913/000119312516789226/d307006dex105.htm)] | | [removed: [Notice] [added: [Form Notice] of TSR Performance Unit Award [added: under the Albemarle Corporation 2008 Incentive Plan] \[filed as Exhibit [removed: 10.2] [added: 10.5] to the Company’s Current Report on Form 8-K (No. 1-12658) filed on [removed: March 2, 2015,] [added: December 9, 2016,] and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000093244015000086/ex10-2_483894.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312516789226/d307006dex105.htm)] |

| [removed: [#10.13](http://www.sec.gov/Archives/edgar/data/915913/000091591316000041/exhibit10141231201510-k.htm)] [added: [#10.22](http://www.sec.gov/Archives/edgar/data/915913/000091591316000041/exhibit10211231201510-k.htm)] | | [removed: [Notice] [added: [Form] of [removed: Restricted Stock Unit Award (2015)] [added: Amendment to Severance Compensation Agreement] \[filed as Exhibit [removed: 10.14] [added: 10.21] to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 (No. 1-12658), and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000091591316000041/exhibit10141231201510-k.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000091591316000041/exhibit10211231201510-k.htm)] |

| [removed: [#10.14](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex101.htm)] [added: [#10.14](http://www.sec.gov/Archives/edgar/data/915913/000091591318000023/exhibit1020331201810q.htm)] | | [Notice of Option Grant \[filed as Exhibit [removed: 10.1] [added: 10.2] to the Company’s [removed: Current] [added: Quarterly] Report on Form [removed: 8-K] [added: 10-Q] (No. 1-12658) filed on [removed: March 2, 2016,] [added: May 9, 2018,] and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex101.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000091591318000023/exhibit1020331201810q.htm)] |

| [removed: [#10.15](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex102.htm)] [added: [#10.11](http://www.sec.gov/Archives/edgar/data/915913/000119312516789226/d307006dex104.htm)] | | [removed: [Notice] [added: [Form Notice] of Restricted Stock Unit Award [added: under the Albemarle Corporation 2008 Incentive Plan] \[filed as Exhibit [removed: 10.2] [added: 10.4] to the Company’s Current Report on Form 8-K (No. 1-12658) filed on [removed: March 2,] [added: December 9,] 2016, and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex102.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312516789226/d307006dex104.htm)] |

| [removed: [#10.16](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex103.htm)] [added: [#10.10](http://www.sec.gov/Archives/edgar/data/915913/000119312516789226/d307006dex103.htm)] | | [removed: [Notice] [added: [Form Notice] of [removed: TSR Performance Unit Award] [added: Option Grant under the Albemarle Corporation 2008 Incentive Plan] \[filed as Exhibit 10.3 to the Company’s Current Report on Form 8-K (No. 1-12658) filed on [removed: March 2,] [added: December 9,] 2016, and incorporated herein by [removed: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312516490189/d152956dex103.htm)] [added: reference\].](http://www.sec.gov/Archives/edgar/data/915913/000119312516789226/d307006dex103.htm)] |