What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2023-03-01 compared with 2022-02-22 · 664 added, 746 removed, 1003 unchanged (58% of the section changed)

1 unchanged sentence

INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm – Internal Control Over Financial Reporting ( Ernst & Young LLP , Baltimore, MD , Auditor Firm ID:

Report of Independent Registered Public Accounting Firm – Consolidated Financial Statements ( Ernst & Young LLP , Baltimore, MD , Auditor Firm ID:

Report of Independent Registered Public Accounting Firm – Internal Control Over Financial Reporting ( Ernst & Young LLP , Philadelphia, PA, Auditor Firm ID:

Report of Independent Registered Public Accounting Firm – Consolidated Financial Statements ( Ernst & Young LLP , Philadelphia, PA, Auditor Firm ID:

Consolidated Statements of Operations 58

19 unchanged sentences

Segment Information 100

Selected Quarterly Data—(unaudited) 103

Report of Independent Registered Public Accounting Firm

Internal Control Over Financial Reporting

To the Shareholders and the Board of Directors of Colfax Corporation

To the Shareholders and the Board of Directors of Enovis Corporation

Opinion on Internal Control over Financial Reporting

We have audited Colfax Corporation’s internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, Colfax Corporation (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of Colfax Corporation as of December 31, 2021 and 2020, the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2021, and the related notes and financial statement schedule listed in the Index 15(A)(2) and our report dated February 22, 2022 expressed an unqualified opinion thereon.

We have audited Enovis Corporation and subsidiaries’ internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, Enovis Corporation and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2022, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of Enovis Corporation as of December 31, 2022 and 2021, the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2022, and the related notes and financial statement schedule listed in the Index 15(A)(2) and our report dated March 1, 2023 expressed an unqualified opinion thereon.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting.

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting.

Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

13 unchanged sentences

/s/ Ernst & Young LLP

Baltimore, Maryland

February 22, 2022

Philadelphia, Pennsylvania

March 1, 2023

Report of Independent Registered Public Accounting Firm

Consolidated Financial Statements

To the Shareholders and the Board of Directors of Colfax Corporation

To the Shareholders and the Board of Directors of Enovis Corporation

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Colfax Corporation (the Company) as of December 31, 2021 and 2020, the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2021, and the related notes and financial statement schedule listed in the Index at Item 15(A)(2) (collectively referred to as the “consolidated financial statements”).

We have audited the accompanying consolidated balance sheets of Enovis Corporation and subsidiaries (the Company) as of December 31, 2022 and 2021, the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2022, and the related notes and financial statement schedule listed in the Index at Item 15(A)(2) (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2022, in conformity with U.S.

generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 22, 2022 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 1, 2023 expressed an unqualified opinion thereon.

Basis for Opinion

9 unchanged sentences

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Description of the Matter At December 31, 2021, the Company’s goodwill allocated to the Medical Technology reporting unit was $1.9 billion.

As discussed in Note 9 to the consolidated financial statements, goodwill is not amortized, but rather is subject to an annual impairment review, or more frequent reviews if events and circumstances indicate an impairment exists.

Auditing the Company's goodwill impairment test was complex and highly judgmental due to the significant estimation required by management to determine the fair value of the Medical Technology reporting unit.

In particular, the fair value estimate was sensitive to significant assumptions, such as changes in the discount rate, market multiples, projected net sales and projected operating income metrics that are forward-looking and affected by future economic and market conditions.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company's controls over its annual goodwill impairment review process, including controls over management’s review of the significant assumptions described above.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to which it relates.

Description of the Matter At December 31, 2022, the Company’s goodwill allocated to the Prevention & Recovery reporting unit and Reconstructive reporting unit was $1.1 billion and $0.9 billion, respectively.

As discussed in Note 9 to the consolidated financial statements, goodwill is not amortized, but rather is subject to an annual impairment test, or more frequent tests if events and circumstances indicate an impairment exists.

Auditing the Company's goodwill impairment test was complex and highly judgmental due to the significant estimation required by management to determine the fair value of the Prevention & Recovery and Reconstructive reporting units.

In particular, the fair value estimate was sensitive to significant assumptions, such as changes in the discount rates, market multiples, projected revenues and projected operating income metrics that are forward-looking and affected by future economic and market conditions.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company's controls over its annual goodwill impairment testing process, including controls over management’s determination of the significant assumptions described above.

We also tested management’s controls over the completeness and accuracy of the data used in the model.

To test the estimated fair value of the Medical Technology reporting unit, we performed audit procedures that included, among others, assessing methodologies and testing the significant assumptions used in the Company’s analyses, as well as testing the completeness and accuracy of the underlying data.

For example, we compared the significant assumptions to current third-party industry data, and to the historical results of the Medical Technology reporting unit.

We performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the Medical Technology reporting unit that would result from changes in key assumptions.

To test the estimated fair value of the Prevention & Recovery and Reconstructive reporting units, we performed audit procedures that included, among others, assessing methodologies and testing the significant assumptions used in the Company’s analyses, as well as testing the completeness and accuracy of the underlying data.

For example, we compared the significant assumptions to current third-party industry data, and to the historical results of the two reporting units.

We performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the two reporting units that would result from changes in key assumptions.

We also involved internal valuation specialists to assist in our evaluation of the methodologies and significant assumptions used by the Company.

In addition, we tested management’s reconciliation of the fair value of both reporting units to the market capitalization of the Company.

Valuation of Acquired Intangible Assets

Description of the Matter During 2021, the Company completed the acquisitions of Trilliant, MedShape and Mathys for net cash consideration of $204 million and equity consideration of $286 million and recognized identifiable intangible assets of $181 million as disclosed in Note 5 to the consolidated financial statements.

These transactions were accounted for as business combinations.

Auditing the Company's purchase accounting for these acquisitions was complex due to the significant estimation required by management to determine the fair value of the acquired intangible assets, which consisted of customer relationships, tradenames and technology.

The estimation complexity was primarily due to the valuation models used to measure the fair value of the intangible assets and the sensitivity of the respective fair values to the significant underlying assumptions.

The significant assumptions used to estimate the fair value of the intangible assets included discount rates, royalty rates, customer attrition, and certain assumptions that form the basis of the forecasted results (e.g., net sales, and operating profit metrics).

These significant assumptions are forward looking and could be affected by future economic and market conditions.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company's controls over its accounting for acquisitions.

For example, we tested controls over the recognition and measurement of intangible assets, including the valuation models and underlying assumptions used to develop such estimates.

We also tested management’s controls over the completeness and accuracy of the data used in the models.

To audit the estimated fair value of the intangible assets, we performed audit procedures that included, among others, evaluating the Company's valuation models and testing the significant assumptions used in the models, as well as testing the completeness and accuracy of the underlying data.

We compared the significant assumptions to current industry, market and economic trends, to the assumptions used to value similar assets in other acquisitions, and to the historical results of the acquired businesses.

We also involved an internal valuation specialist to assist in our evaluation of the significant assumptions and those procedures included the completion of independent calculations of the fair value of the acquired intangible assets.

Asbestos Liability

Description of the Matter At December 31, 2021, the Company’s asbestos liability balance was $292 million.

As discussed in Note 18 of the consolidated financial statements, certain of the Company’s subsidiaries are defendants in a large number of lawsuits that claim personal injury as a result of exposure to asbestos from products manufactured with components that are alleged to have contained asbestos.

The Company records an asbestos liability for probable pending and future claims over the period that the Company believes it can reasonably estimate such claims.

Auditing the asbestos liability was complex and highly judgmental due to the significant estimation of numerous variables required in determining the asbestos obligation.

In particular, the estimates were sensitive to significant assumptions such as the period of time over which claims activity can be reasonably predicted, the number of future asbestos-related claims that may be received, the type and severity of disease alleged by each claimant, dismissal rates, the lag time between the filing and the settlement of claims, and settlement values.

These assumptions have a significant effect on the asbestos liability.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s process to estimate the asbestos liability, including controls related to estimates of expected future claims and other key assumptions underlying the calculation of the obligation.

We also tested management’s controls over the completeness and accuracy of the data used in the calculation.

To audit the asbestos liability recorded by management, we performed procedures that included, among others, evaluating the methodology applied and the significant assumptions used in the Company’s calculation.

For example, we assessed management’s assumptions for the nature and rate of future claims, claims disposition and settlement patterns by comparing these assumptions to the Company’s historical experience and industry data.

We considered the Company’s historical data and industry data in evaluating the adequacy of the Company’s projections.

We developed, with the assistance of an internal actuarial specialist, an independent range of estimated asbestos liability.

We tested the completeness and accuracy of the claims data used by management.

We also performed analyses to determine the sensitivity of changes in certain assumptions, such as the period over which claims can be estimated, to the calculated liability.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2002.

Baltimore, Maryland

February 22, 2022

COLFAX CORPORATION

Philadelphia, Pennsylvania

March 1, 2023

ENOVIS CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

6 unchanged sentences

Selling, general and administrative expense 772,913 665,775 515,467

Restructuring and other related charges 27,639 38,413 65,295

Operating income 256,643 162,291 203,612

Pension settlement loss (gain) ( 11,208 ) — 33,616

Research and development expense 60,827 49,094 34,268

Amortization of acquired intangibles 126,301 116,920 103,306

Insurance settlement gain ( 36,705 ) — —

Restructuring and other charges 17,225 8,685 16,781

Operating loss ( 71,178 ) ( 62,799 ) ( 66,182 )

Interest expense, net 24,052 29,112 52,824

Debt extinguishment charges 20,396 29,870 —

Income from continuing operations before income taxes 165,388 58,029 50,493

Gain on investment in ESAB Corporation ( 102,669 ) — —

Gain on cost basis investment ( 8,800 ) — —

Other income ( 2,088 ) — —

Loss from continuing operations before income taxes ( 2,069 ) ( 121,781 ) ( 119,006 )

Income tax expense (benefit) 36,120 ( 19,528 ) ( 44,579 )

Net income from continuing operations 98,693 64,082 18,863

Loss from discontinued operations, net of taxes ( 22,415 ) ( 18,311 ) ( 536,009 )

Net loss from continuing operations ( 38,189 ) ( 102,253 ) ( 74,427 )

Income from discontinued operations, net of taxes 26,430 178,531 120,198

Net income (loss) ( 11,759 ) 76,278 45,771

income attributable to noncontrolling interest, net of taxes 4,621 3,146 10,500

Net income (loss) attributable to Colfax Corporation $ 71,657 $ 42,625 $ ( 527,646 )

Net income (loss) per share - basic

Continuing operations $ 0.61 $ 0.45 $ 0.10

Discontinued operations $ ( 0.15 ) $ ( 0.13 ) $ ( 3.99 )

Consolidated operations $ 0.47 $ 0.31 $ ( 3.89 )

Net income (loss) per share - diluted

net income attributable to noncontrolling interest from continuing operations - net of taxes 567 1,052 692

net income attributable to noncontrolling interest from discontinued operations - net of taxes 966 3,569 2,454

Net income (loss) attributable to Enovis Corporation $ ( 13,292 ) $ 71,657 $ 42,625

Net income (loss) per share - basic and diluted

Continuing operations $ ( 0.72 ) $ ( 2.02 ) $ ( 1.65 )

2 unchanged sentences

See Notes to Consolidated Financial Statements.

COLFAX CORPORATION

ENOVIS CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

13 unchanged sentences

629 5,025 3,735

Amortization of pension and other post-retirement prior service cost — — 32

Divestiture-related recognition of foreign currency translation, pension, and other post-retirement cost — — 291,263

Other comprehensive income (loss) ( 39,514 ) ( 65,247 ) 29,178

1 unchanged sentence

comprehensive income (loss) attributable to noncontrolling interest ( 583 ) 3,281 585

Comprehensive income (loss) attributable to Colfax Corporation $ 7,750 $ 74,364 $ ( 195,986 )

Comprehensive income (loss) attributable to Enovis Corporation $ ( 50,690 ) $ 7,750 $ 74,364

See Notes to Consolidated Financial Statements.

COLFAX CORPORATION

ENOVIS CORPORATION

CONSOLIDATED BALANCE SHEETS

7 unchanged sentences

Other current assets 48,155 29,176

Total current assets associated with discontinued operations — 956,614

Total current assets 795,023 2,303,279

4 unchanged sentences

Other assets 80,288 74,700

Total non-current assets associated with discontinued operations — 2,738,049

Total assets $ 4,273,248 $ 8,515,912

4 unchanged sentences

Accrued liabilities 210,292 225,391

Total current liabilities associated with discontinued operations — 635,284

Total current liabilities 565,199 1,023,584

2 unchanged sentences

Other liabilities 166,989 122,159

Total non-current liabilities associated with discontinued operations — 573,562

Total liabilities 823,447 3,854,479

5 unchanged sentences

Accumulated other comprehensive loss ( 53,430 ) ( 516,013 )

Total Colfax Corporation equity 4,617,378 3,543,387

Total Enovis Corporation equity 3,448,085 4,617,378

Noncontrolling interest 1,716 44,055

2 unchanged sentences

See Notes to Consolidated Financial Statements.

COLFAX CORPORATION

ENOVIS CORPORATION

CONSOLIDATED STATEMENTS OF EQUITY

4 unchanged sentences

Cumulative effect of accounting change — — — ( 4,818 ) — — ( 4,818 )

Net loss — — — ( 527,646 ) — 10,500 ( 517,146 )

Net income — — — 42,625 — 3,146 45,771

Distributions to noncontrolling owners — — — — — ( 4,296 ) ( 4,296 )

Noncontrolling interest share repurchase — — ( 24,037 ) — ( 19,960 ) ( 49,508 ) ( 93,505 )

Other comprehensive income, net of tax expense of $ 621

Other comprehensive income, net of tax benefit of $ 9,764

— — — — 31,739 ( 2,561 ) 29,178

Issuance of Tangible Equity Units — — 377,814 — — — 377,814

Common stock-based award activity 145,869 — 32,411 — — — 32,411

Balance at December 31, 2020 39,498,896 40 3,478,086 517,367 ( 452,106 ) 44,487 3,587,874

Cumulative effect of accounting change — — — ( 4,818 ) — — ( 4,818 )

Net income — — — 71,657 — 4,621 76,278

Distributions to noncontrolling owners — — — — — ( 3,713 ) ( 3,713 )

Other comprehensive income, net of tax benefit of $ 9,764

Other comprehensive income, net of tax expense of $ 14,945

— — — — ( 63,907 ) ( 1,340 ) ( 65,247 )

Common stock offering, net of issuance costs 5,366,667 5 711,334 — — — 711,339

Conversion of tangible equity units into common stock 4,441,488 4 ( 4 ) — — — —

Common stock issued for acquisition, net of issuance costs 2,181,507 2 285,678 — — — 285,680

Common stock-based award activity 594,520 1 69,221 — — — 69,222

4 unchanged sentences

— — — — ( 37,398 ) ( 2,116 ) ( 39,514 )

Common stock offering, net of issuance costs 16,100,000 16 711,323 — — — 711,339

Distribution of ESAB Corporation — — ( 1,662,795 ) — 499,981 ( 40,510 ) ( 1,203,324 )

Conversion of tangible equity units into common stock 1,691,845 2 ( 2 ) — — — —

Common stock issued for acquisition, net of issuance costs 6,544,522 7 285,673 — — — 285,680

Acquisition — — — — — 345 345

Common stock-based award activity 453,696 — 44,211 — — — 44,211

1 unchanged sentence

See Notes to Consolidated Financial Statements.

COLFAX CORPORATION

ENOVIS CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

4 unchanged sentences

Net income (loss) $ ( 11,759 ) $ 76,278 $ 45,771

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Divestiture impairment loss — — 449,000

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Depreciation, amortization and other impairment charges 219,710 262,919 246,229

1 unchanged sentence

Non-cash interest expense 3,921 4,752 5,739

Gain on investment in ESAB Corporation ( 102,669 ) — —

Gain on cost basis investment ( 8,800 ) — —

Debt extinguishment charges 20,396 29,870 —

Deferred income tax benefit ( 22,188 ) ( 29,218 ) ( 590 )

Deferred income tax expense (benefit) 6,320 ( 22,188 ) ( 29,218 )

(Gain) loss on sale of property, plant and equipment 352 ( 2,573 ) ( 491 )

Gain on sale of business — — ( 14,233 )

Pension settlement (gain) loss ( 11,208 ) — 77,390

Pension settlement gain — ( 11,208 ) —

Changes in operating assets and liabilities:

3 unchanged sentences

Other operating assets and liabilities ( 46,464 ) 45,384 ( 30,734 )

Net cash provided by operating activities 356,099 301,935 130,948

Net cash (used in) provided by operating activities ( 55,861 ) 356,099 301,935

Cash flows from investing activities:

Purchases of property, plant and equipment ( 104,237 ) ( 114,785 ) ( 125,402 )

Purchases of property, plant and equipment and intangibles ( 105,450 ) ( 104,237 ) ( 114,785 )

Proceeds from sale of property, plant and equipment 2,746 7,033 9,552

Acquisitions, net of cash received, and investments ( 73,684 ) ( 223,272 ) ( 69,846 )

Proceeds from sale of business, net — — 1,635,920

Net cash used in investing activities ( 176,388 ) ( 320,476 ) ( 175,079 )

4 unchanged sentences

Repayments of borrowings on revolving credit facilities and other ( 634,883 ) ( 417,526 ) ( 938,997 )

(Repayments of)/Proceeds from borrowings on senior notes ( 700,000 ) — 1,000,000

Repayments of borrowings on Senior notes ( 300,000 ) ( 700,000 ) —

Repayments of borrowings on Euro senior notes ( 386,278 ) — —

Distribution from ESAB Corporation, net 1,143,369 — —

Payment of debt issuance costs ( 2,938 ) — ( 4,560 )

Proceeds from prepaid stock purchase contract — — 377,814

Proceeds from issuance of common stock, net 5,814 745,179 3,500

Payment of debt extinguishment costs ( 12,704 ) ( 24,375 ) —

Payment for noncontrolling interest share repurchase — — ( 93,505 )

Deferred consideration payments and other ( 7,507 ) ( 9,866 ) ( 12,275 )

Net cash provided by (used in) financing activities 584,906 ( 131,651 ) 1,369,494

Net cash (used in) provided by financing activities ( 465,127 ) 584,906 ( 131,651 )

Effect of foreign exchange rates on Cash and cash equivalents and Restricted Cash 2,301 ( 2,228 ) ( 3,768 )

Increase (decrease) in Cash and cash equivalents and Restricted cash 618,301 ( 8,563 ) ( 135,387 )

(Decrease) increase in Cash and cash equivalents and Restricted cash ( 695,075 ) 618,301 ( 8,563 )

Cash and cash equivalents and Restricted Cash, beginning of period 719,370 101,069 109,632

Cash and cash equivalents and Restricted Cash, end of period $ 719,370 $ 101,069 $ 109,632

Cash and cash equivalents, end of period $ 24,295 $ 719,370 $ 101,069

Supplemental disclosures:

2 unchanged sentences

Common stock issued for acquisition, net of issuance costs $ — $ 285,680 $ —

ESAB Corporation shares exchanged for debt, net of fees $ 230,532 $ — $ —

See Notes to Consolidated Financial Statements.

COLFAX CORPORATION

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Organization and Nature of Operations

Colfax Corporation (the “Company” or “Colfax”) is a leading diversified technology company that provides fabrication technology and medical device products and services to customers around the world under the ESAB and DJO brands.

The Company conducts its operations through two operating segments, “Fabrication Technology”, which incorporates the operations of ESAB and its related brands, and “Medical Technology”, which incorporates the operations of DJO and its related brands.

The Company completed the purchase of DJO Global, Inc.

(“DJO”) on February 22, 2019, which became a new growth platform for Colfax.

See Note 5, “Acquisitions”, for further information.

Colfax completed the sale of its Air and Gas Handling business on September 30, 2019.

Enovis Corporation (the “Company” or “Enovis”) was previously Colfax Corporation (“Colfax”) until its separation into two differentiated, independent, and publicly traded companies on April 4, 2022.

Colfax was a leading diversified technology company that provided fabrication technology and medical device products and services to customers around the world, principally under the ESAB and DJO brands.

Following the completion of the Separation, the Company revised its reporting structure and conducts its business through two operating segments, “Prevention & Recovery” and “Reconstructive”.

The segment results were retroactively restated to the current method the Company conducts its business for all years presented.

On April 4, 2022, the Company completed the separation of its fabrication technology business (the “Separation”) through a tax free, pro-rata distribution of 90 % of the outstanding common stock of ESAB Corporation (“ESAB”) to Colfax stockholders.

To affect the Separation, Colfax distributed to its stockholders one share of ESAB common stock for every three shares of Colfax common stock held at the close of business on March 22, 2022, with the Company initially retaining 10 % of the shares of ESAB common stock immediately following the Separation.

Upon completion of the Separation, Colfax, which retained the Company’s specialty medical technology business, changed its name to Enovis Corporation.

On April 5, 2022, the Company began trading under the stock symbol “ENOV” on the New York Stock Exchange.

In connection with the Separation, ESAB issued $ 1.2 billion of new debt securities, the proceeds from which were used to fund a $ 1.2 billion cash distribution to Enovis upon Separation.

The distribution proceeds were used by Enovis in conjunction with $ 450 million of borrowings on a term loan under the new Enovis Credit Agreement, as discussed below, and $ 52.3 million of cash on hand to repay $ 1.4 billion of outstanding debt and accrued interest on the Company’s prior credit facility, and $ 302.8 million of outstanding debt and accrued interest on its 2026 Notes, pay a redemption premium at 103.188 % of the principal amount of the 2026 Notes, and pay other fees and expenses due at closing.

Additionally, on April 7, 2022, the Company also completed the redemption of its Euro Senior Notes representing all of its outstanding € 350 million principal 3.250 % Senior Notes due 2025 at a redemption price of 100.813 % of the principal amount.

Immediately following the Separation, the Company effected a one-for-three reverse stock split of all issued and outstanding shares of Enovis common stock.

As a result of the reverse stock split, all share and per share figures contained in the accompanying Consolidated Financial Statements have been retroactively restated as if the reverse stock split occurred at the beginning of the periods presented.

The Company completed the divestiture of its 10 % retained shares in ESAB in a tax-efficient exchange for $ 230.5 million of its $ 450 million term loan outstanding under the Credit Agreement on November 18, 2022.

The accompanying Consolidated Financial Statements present our historical financial position, results of operations, changes in equity and cash flows in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Certain reclassifications have been made to prior year financial information to conform to the current period presentation.

Unless otherwise indicated, all amounts in the notes to the consolidated financial statements refer to continuing operations.

The accompanying Consolidated Financial Statements reflect the results of (1) ESAB, the Company’s former fabrication technology business;

(2) charges, assets and liabilities for previously retained asbestos contingencies;

and (3) divestiture-related expenses associated with our former Air and Gas Handling business (“Air & Gas”) that was sold in 2019 as a discontinued operation for all periods presented.

See Note 4, “Discontinued Operations”, for further information.

These transactions were the culmination of a multi-year strategic plan to remodel the Company into a faster growth, higher margin, and less cyclical business with opportunities for significant bolt-on and adjacent acquisitions over time.

The Company applies the Colfax Business System (“CBS”) to continuously improve and pursue growth in revenues and increase profits and cash flows.

On March 4, 2021, the Company announced its intention to separate its fabrication technology and specialty medical technology businesses into two differentiated, independent, and publicly traded companies (the “Separation”).

The current Colfax entity will retain the specialty medical technology business under a new name, Enovis Corporation.

The fabrication technology business will operate independently under the existing ESAB brand name.

The Separation is intended to be structured in a tax-free manner and is targeted to be completed near the end of the first quarter of 2022.

The assets, liabilities, revenues and expenses of the fabrication technology businesses are included in continuing operations of the Company in the accompanying Consolidated Financial Statements.

The COVID-19 pandemic, its resulting impact on governments, businesses and individuals, and actions taken by them in response to the situation resulted in widespread economic disruptions, which significantly affected broader economies, financial markets, and overall demand for the Company’s products in fiscal year 2020.

Other than a surge of COVID-19 cases due to the emergence of COVID-19 variants in the third quarter of 2021, the impacts lessened in 2021 and 2022 due to broadening access to COVID-19 vaccines and gradual relaxing of some government-mandated restrictions.

Sales in our Prevention & Recovery and Reconstructive segments typically peak in the fourth quarter.

These historical seasonality trends were disrupted by the commercial impacts caused by the COVID-19 pandemic.

General economic conditions may, however, impact future seasonal variations.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Summary of Significant Accounting Policies

Principles of Consolidation

The Company’s Consolidated Financial Statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) and include all majority-owned subsidiaries over which the Company exercises control and, when applicable, entities or joint ventures for which the Company has a controlling financial interest or is the primary beneficiary.

The Company’s Consolidated Financial Statements are prepared in accordance with GAAP and include all majority-owned subsidiaries over which the Company exercises control and, when applicable, entities or joint ventures for which the Company has a controlling financial interest or is the primary beneficiary.

When protective rights, substantive rights or other factors exist, further analysis is performed in order to determine whether or not there is a controlling financial interest.

3 unchanged sentences

Investments accounted for under the equity method are initially recorded at the amount of the Company’s initial investment and adjusted each period for the Company’s share of the investee’s income or loss and dividends paid.

The Company accounts for equity investments that do not have a readily determinable fair value as cost method investments under the measurement alternative under U.S.

GAAP to the extent such investments are not subject to consolidation or the equity method of accounting as described above.

The Company accounts for equity investments that do not have a readily determinable fair value as cost method investments under the measurement alternative under GAAP to the extent such investments are not subject to consolidation or the equity method of accounting as described above.

Under the measurement alternative, these financial instruments are carried at cost, less any impairment, adjusted for changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer.

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If the decline in fair value is considered to be other-than-temporary, an impairment loss is recorded and the investment is written down to a new carrying value.

As of December 31, 2022, the Company held investments of $ 16.5 million in privately held companies, the majority of which are within the Prevention & Recovery operating segment.

These investments represent minority ownership interests and are accounted for under the cost method as the Company does not have significant influence over the investees.

The largest of the Company’s investments consist of a $ 10.0 million investment in HT Bioimaging Ltd., a company that has developed a non-invasive cancer scanning technology for veterinarians.

Revenue Recognition

The Company recognizes revenue when control of promised goods or services is transferred to the customer.

The amount of revenue recognized reflects the consideration to which the Company expects to be entitled in exchange for transferring the

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

goods or services.

The Company provides a variety of products to its customers with revenue being measured as the amount of consideration we expect to receive in exchange for transferring such products.

Revenue is recognized at a point in time when we transfer control of our off-the-shelf products to the customer, which generally occurs when title passes upon shipment.

The Company’s contracts have a single performance obligation as the promise to transfer the individual goods is not separately identifiable from other promises in the contract and, therefore, not distinct.

Revenue recognition and billing typically occur simultaneously for contracts recognized at a point in time.

Therefore, we do not have material revenues in excess of customer billings or billings to customers in excess of recognized revenues.

Refer to Note 6, “Revenue”, and Note 15, “Accrued Liabilities”, for additional information on the Company’s contract liability balances.

The amount of revenue recognized reflects the consideration to which the Company expects to be entitled in exchange for transferring the goods or services.

The nature of the Company’s contracts gives rise to certain types of variable consideration, including rebates and other discounts.

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Any estimates are evaluated on a quarterly basis until the uncertainty is resolved.

Additionally, related to sales of its medical device products and services, the Company maintains provisions for estimated contractual allowances for reimbursement amounts from certain third-party payors based on negotiated contracts, historical experience for non-contracted payors, and the impact of new contract terms or modifications of existing arrangements with these customers.

We report these allowances as a reduction to net sales.

The Company provides a variety of products and services to its customers.

Most of the Company’s contracts consist of a single, distinct performance obligation or promise to transfer goods or services to a customer.

For contracts that include multiple performance obligations, we allocate the total transaction price to each performance obligation using our best estimate of the stand-alone selling price of each identified performance obligation.

A significant majority of our revenue relates to the shipment of off-the-shelf products that is recognized when control is transferred to the customer.

On a limited basis, we have agreements with customers that have multiple performance obligations.

In determining whether there are multiple performance obligations, we first assess the goods or services promised in the customer arrangement and then consider the guidance in ASC 606, Revenue from Contracts with Customers, to evaluate whether goods and services are capable of being distinct and are considered distinct within the customer arrangement.

To determine whether promised goods or services are separately identifiable (i.e., whether a promise to transfer a good or service is distinct in the context of the contract), we evaluate whether the contract is to deliver (1) multiple promised goods or services or (2) a combined item that comprises the individual goods or services promised in the contract.

Substantially all revenue involving development and application engineering projects consists of a single performance obligation and is recognized at a point in time.

A majority of revenue recognized by the Company relates to contracts with the customers for standard or off-the-shelf products.

As control typically transfers to the customer upon shipment of the product in these circumstances, revenue is generally recognized at that point in time.

Revenue recognition and billing typically occur simultaneously for contracts recognized at a point in time.

Therefore, we do not have material revenues in excess of customer billings or billings to customers in excess of recognized revenues.

Refer to Note 6, “Revenue”, and Note 15, “Accrued Liabilities”, for additional information on the Company’s contract liability balances.

For service contracts, the Company recognizes revenue ratably over the period of performance as the customer simultaneously receives and consumes the benefits of the services provided.

The Company applies the available practical expedient involving the existence of a significant financing component.

As the Company generally does not receive payments greater than one year in advance or arrears of revenue recognition, the Company does not consider any arrangements to include financing components.

Additionally, the Company maintains provisions for estimated contractual allowances for reimbursement amounts from certain third-party payors based on negotiated contracts, historical experience for non-contracted

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

payors, and the impact of new contract terms or modifications of existing arrangements with these customers.

These allowances are recorded as a reduction to sales in the same period that the sales are recognized.

The period of benefit for the Company’s incremental costs of obtaining a contract generally have less than a one-year duration;

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Research and Development Expense

Research and development costs of $ 88.8 million, $ 68.6 million and $ 61.8 million fo r the years ended December 31, 2021, 2020 and 2019, respectively, are expensed as incurred and are included in Selling, general and administrative expense in the Consolidated Statements of Operations.

These amounts do not include development and application engineering costs incurred in conjunction with fulfilling customer orders and executing customer projects.

Research and development costs are expensed as incurred.

Costs include salaries, wages, consulting and depreciation and maintenance of facilities and equipment utilized in research, development and engineering activities relating to developing new products, as well as enhancing existing products with the latest technology and designs, creating new applications for existing products, lowering manufacturing costs and redesigning existing products to increase efficiency, improve durability, enhance performance and usability.

The Company also receives new product and invention ideas from orthopedic surgeons and other healthcare professionals and seeks to obtain rights to ideas it considers promising from a clinical and commercial perspective through entering into either assignment or licensing agreements.

The Company maintains contractual relationships with orthopedic surgeons who assists in developing products and may also provide consulting services in connection with our products.

Interest Expense, Net

Interest expense, net includes interest income of $ 0.2 million, $ 0.2 million and $ 0.3 million for the years ended December 31, 2022, 2021 and 2020, respectively, primarily associated with interest-bearing deposits of certain foreign subsidiaries.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Cash and Cash Equivalents

Cash and cash equivalents include all financial instruments purchased with an initial maturity of three months or less.

Restricted Cash

Cash and cash equivalents that are restricted as to withdrawal or use under the terms of certain contractual agreements are excluded from Cash and cash equivalents in the Consolidated Balance Sheets.

Restricted cash is recorded as a component of Other current assets on the Consolidated Balance Sheets.

The following table summarizes the Company’s Cash and cash equivalents and Restricted cash:

(In thousands)

Cash and cash equivalents $ 719,370 $ 97,068

Restricted cash — 4,001

Total cash and cash equivalents and restricted cash $ 719,370 $ 101,069

Trade Receivables

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Inventories, net include the cost of material, labor and overhead and are stated at the lower of cost or net realizable value.

Cost is determined under various methods including average cost, last-in, first-out (“LIFO”) and first-in, first-out, but predominantly first-in, first-out.

The value of inventory stated using the LIFO method as of December 31, 2021 and 2020 was $ 142.4 million and $ 105.1 million, respectively.

Cost is determined under various methods including average cost and first-in, first-out.

The Company periodically reviews its quantities of inventories on hand and compares these amounts to the expected usage of each particular product.

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Property, Plant and Equipment

Property, plant and equipment, net is stated at historical cost, which includes the fair values of such assets acquired through acquisitions.

Property, plant and equipment, net is stated at historical cost, which includes the fair values of such assets acquired through acquisitions, and depreciated by the straight-line method over the estimated useful lives of the related assets.

Repair and maintenance expenditures are expensed as incurred unless the repair extends the useful life of the asset.

The Company capitalizes surgical implant instruments that are provided free-of-charge to surgeons for use while implanting its surgical products and the related depreciation expense is recorded as a component of Selling, general and administrative expense.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Impairment of Goodwill and Indefinite-Lived Intangible Assets

Goodwill represents the costs in excess of the fair value of net assets acquired through acquisitions by the Company.

Indefinite-lived intangible assets consist of certain trade names.

The Company evaluates the recoverability of Goodwill and indefinite-lived intangible assets annually or more frequently if an event occurs or circumstances change in the interim that would more likely than not reduce the fair value of the asset below its carrying amount.

The Company evaluates the recoverability of Goodwill annually or more frequently if an event occurs or circumstances change in the interim that would more likely than not reduce the fair value of the asset below its carrying amount.

The annual impairment test date elected by the Company is the first day of its fourth quarter.

Goodwill and indefinite-lived intangible assets are considered to be impaired when the carrying value of a reporting unit or asset exceeds its fair value.

Goodwill is considered to be impaired when the carrying value of a reporting unit or asset exceeds its fair value.

The Company currently has two reporting units:

Medical Technology and Fabrication Technology.

Prevention & Recovery and Reconstructive.

In the evaluation of Goodwill for impairment, the Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting entity is less than its carrying value.

If the Company determines that it is more likely than not for a reporting unit’s fair value to be greater than its carrying value, a calculation of the fair value is not

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

If the Company determines that it is more likely than not for a reporting unit’s fair value to be greater than its carrying value, a calculation of the fair value is not performed.

If the Company determines that it is more likely than not for a reporting unit’s fair value to be less than its carrying value, a calculation of the reporting entity’s fair value is performed and compared to the carrying value of that entity.

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Significant estimates in the market approach model include identifying appropriate peer companies, market multiples and assessing earnings before interest, income taxes, depreciation and amortization.

A qualitative annual impairment test of Goodwill for the Fabrication Technology reporting unit was performed for the years ended December 31, 2021 and 2019, while a quantitative assessment was performed for the year ended December 31, 2020 , all of which indicated no impairment existed.

A quantitative annual impairment test of Goodwill for the Medical Technology reporting unit was performed for the years ended December 31, 2021 and 2020, while a qualitative assessment was performed for the year ended December 31, 2019 , all of which indicated no impairment existed.

In the evaluation of indefinite-lived intangible assets for impairment, the Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying value.

If the Company determines that it is more likely than not for the indefinite-lived intangible asset’s fair value to be greater than its carrying value, a calculation of the fair value is not performed.

If the Company determines that it is more likely than not that the indefinite-lived intangible asset’s fair value is less than its carrying value, a calculation is performed and compared to the carrying value of the asset.

In certain instances, the Company may elect to forgo the qualitative assessment and proceed directly to the quantitative impairment test.

If the carrying amount of the indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

The Company measures the fair value of its indefinite-lived intangible assets using the “relief from royalty” method.

Significant estimates in this approach include projected revenues and royalty and discount rates for each trade name evaluated .

Quantitative impairment tests were performed for all the indefinite-lived trade name brands in the Fabrication Technology segment for the year ended December 31, 2021 and 2020 while a combination of quantitative impairment tests and qualitative assessments were performed for the year ended December 31, 2019, all of which indicated no impairment existed.

For the year ended December 31, 2022, the Company performed a quantitative assessment of Goodwill for the Reconstructive and Prevention & Recovery reporting units, both of which indicated no impairment existed.

The carrying amount of Goodwill of the Reconstructive and Prevention & Recovery reporting units for the year ended December 31, 2022 was $ 0.9 billion and $ 1.1 billion, respectively.

The Company determined the fair value of the reporting units by equally weighting a discounted cash flow approach and market valuation approach, and the reporting unit’s fair value exceeded its carrying amount by approximately 8 % and 9 %, respectively.

Determining the fair value of a reporting unit requires the application of judgment and involves the use of significant estimates and assumptions which can be affected by changes in business climate, economic conditions, the competitive environment and other factors.

The Company bases these fair value estimates on assumptions the Company’s management believes to be reasonable but which are unpredictable and inherently uncertain.

Future changes in the judgment, assumptions and estimates could result in significantly different estimates of fair value in the future.

An increase in discount rates, a reduction in projected cash flows or a combination of the two could lead to a reduction in the estimated fair values, which may result in impairment charges that could materially affect the Company’s financial statements in any given year.

For sensitivity analysis, the Company estimated the fair value of the Prevention & Recovery and Reconstructive reporting units if the Company reduced the long-term revenue growth rate by 25 basis points, and the resulting excess fair value over carrying value decreased by 120 and 130 basis points, respectively.

Upon the Separation and the revision of the Company’s operating segments, the Company evaluated and concluded that it has two reporting units, Prevention & Recovery and Reconstructive.

An allocation of goodwill was performed to the new reporting units.

A quantitative impairment test of Goodwill for the Prevention & Recovery and Reconstructive reporting units was performed for the years ended December 31, 2022, which indicated no impairment existed.

Impairment of Long-Lived Assets Other than Goodwill and Indefinite-Lived Intangible Assets

Intangible assets primarily represent acquired trade names, customer relationships, acquired technology and software license agreements.

A portion of the Company’s acquired customer relationships is being amortized on an accelerated basis over periods ranging from ten to thirty years based on the present value of the future cash flows expected to be generated from the acquired customers.

All other intangible assets are being amortized on a straight-line basis over their estimated useful lives, generally rang ing from three to twenty years .

Intangible assets are being amortized on a straight-line basis over their estimated useful lives, which approximates the period of benefit, and ranges from three to twenty years .

The Company assesses its long-lived assets and finite-lived intangible assets for impairment whenever facts and circumstances indicate that the carrying amounts may not be fully recoverable.

To analyze recoverability, the Company projects undiscounted net future cash flows over the remaining lives of such assets.

To analyze recoverability, the Company projects

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

undiscounted net future cash flows over the remaining lives of such assets.

If these projected cash flows are less than the carrying amounts, an impairment loss equal to the difference between the carrying amount of the asset and its fair value would be recognized, resulting in a write-down of the assets with a corresponding charge to earnings.

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Management determines fair value using the discounted cash flow method or other accepted valuation techniques.

The Company recorded asset impairment losses related to facility closures total ing $ 1.3 million, $ 3.5 million and $ 4.2 million during the years ended December 31, 2021, 2020 and 2019, respectively, as a c omponent of Restructuring and other related charges in the Consolidated Statements of Operations.

The aggregate carrying value of these assets subsequent to impairment wa s $ 8.3 million, $ 62.5 million and $ 44.6 million as of December 31, 2021, 2020 and 2019, respectively.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company did not record any asset impairment charges during the years ended December 31, 2022 and 2021.

The Company recorded an asset impairment loss related to a facility closure totaling $ 1.6 million during the year ended December 31, 2020, as a component of Restructuring and other charges in the Consolidated Statements of Operations.

The Company is subject to foreign currency risk associated with the translation of the net assets of foreign subsidiaries to United States (“U.S.”) dollars on a periodic basis.

On April 19, 2017, the Company issued senior unsecured notes with an aggregate principal amount of € 350 million (as defined and further discussed in Note 13, “Debt”), which has been designated as a net investment hedge in order to mitigate a portion of its foreign currency risk.

Derivative instruments are generally recognized on a gross basis in the Consolidated Balance Sheets in either Other current assets, Other assets, Accrued liabilities or Other liabilities depending upon their respective fair values and maturity dates.

4 unchanged sentences

See Note 17, “Financial Instruments and Fair Value Measurements” for additional information regarding the Company’s derivative instruments.

Warranty Costs

Estimated expenses related to product warranties are accrued as the revenue is recognized on products sold to customers and included in Cost of sales in the Consolidated Statements of Operations.

Estimates are established using historical information as to the nature, frequency, and average costs of warranty claims.

The activity in the Company’s warranty liability, which is included in Accrued liabilities in the Company’s Consolidated Balance Sheets, consisted of the following:

Year Ended December 31,

(In thousands)

Warranty liability, beginning of period $ 15,543 $ 15,528

Accrued warranty expense 8,810 7,253

Changes in estimates related to pre-existing warranties 2,416 1,849

Cost of warranty service work performed ( 10,857 ) ( 9,708 )

Acquisition-related liability 1,830 300

Foreign exchange translation effect ( 285 ) 321

Warranty liability, end of period $ 17,457 $ 15,543

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Income taxes for the Company are accounted for under the asset and liability method.

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The Company recognizes interest and penalties related to unrecognized income tax benefits in Income tax expense (benefit) in the Consolidated Statements of Operations.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Foreign Currency Exchange Gains and Losses

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During the year ended December 31, 2022, the Company recognized net foreign currency transaction gain of $ 0.7 million in Interest expense, net and net foreign currency transaction loss of $ 0.6 million in Selling, general and administrative expense in the Consolidated Statements of Operations.

During the year ended December 31, 2020, the Company recognized net foreign currency transaction gain of $ 2.8 million in Interest expense, net and net foreign currency transaction loss o f $ 2.4 million in Selling, general and administrative expense in the Consolidated Statements of Operations.

During the year ended December 31, 2019, the Company recognized net foreign currency transaction gain of $ 0.5 million i n Interest expense, net and net foreign currency transaction loss of $ 0.7 million in Selling, general and administrative expense in the Consolidated Statements of Operations.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the year ended December 31, 2021, the Company recognized net foreign currency transaction loss of $ 0.5 million in Interest expense, net and net foreign currency transaction loss of $ 2.0 million in Selling, general and administrative expense in the Consolidated Statements of Operations.

During the year ended December 31, 2020, the Company recognized net foreign currency transaction gain of $ 1.1 million in Interest expense, net and net foreign currency transaction loss of $ 1.6 million in Selling, general and administrative expense in the Consolidated Statements of Operations.

Debt Issuance Costs and Debt Discount

9 unchanged sentences

Reclassifications

Certain prior period amounts have been reclassified to conform to current year presentations, including certain items within Note 6, “Revenue” and Note 11, “Inventories, Net”.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Certain prior period amounts have been reclassified to conform to current year presentations.

The operating results of ESAB, which was separated on April 4, 2022, are presented as discontinued operations in the Consolidated Statement of Operations for all periods presented and the net assets of ESAB and the other entities that were part of the Separation, including asbestos contingencies, are presented as discontinued operations on the Consolidated Balance Sheet as of December 31, 2021.

See Note 4, “Discontinued Operations” for further information.

Amortization of acquired intangibles and Research and development expense are now separately presented on our Consolidated Statements of Operations;

these amounts were previously included in Selling, general and administrative expense.

Note 6, “Revenue” and Note 19, “Segment Information” have been further disaggregated to conform to current year presentation .

Recently Issued Accounting Pronouncements

Accounting Guidance Implemented in 2021

Standards Adopted Description Effective Date

ASU 2018-14, Compensation - Retirement Benefits - Defined Benefit Plans - General (Topic 715-20):

Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans The ASU modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans.

The adoption of this ASU did not have a material impact on the Company’s Consolidated Financial Statements.

January 1, 2021

ASU 2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes The ASU eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences.

It also clarifies and simplifies other aspects of accounting for income taxes.

The Company adopted this ASU as of January 1, 2021 on a prospective basis, and the adoption did not have a material impact on the Company’s Consolidated Financial Statements.

January 1, 2021

COLFAX CORPORATION

The Company evaluates the adoption impacts of recently issued accounting pronouncements as well as material updates to previous pronouncements on the Company’s Consolidated Financial Statements.

There were no new material accounting standards adopted in 2022 that impacted the Company.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Discontinued Operations

Sale of Air and Gas Handling Business

As discussed previously in Note 1, “Organization and Nature of Operations,” the Company sold its Air and Gas Handling business on September 30, 2019.

Accordingly, the accompanying Consolidated Financial Statements for all periods presented reflect the Air and Gas Handling business as a discontinued operation.

The total consideration for the sale was $ 1.8 billion, including $ 1.67 billion in cash paid at closing and the assumption of certain liabilities and minority interests by the purchaser.

Based on the purchase price and the carrying value of the net assets sold, the Company recorded an impairment loss of $ 481 million in the second quarter of 2019, which is included in Loss from discontinued operations, net of taxes in the Consolidated Statements of Operations.

The impairment loss included a $ 449 million goodwill impairment charge and a $ 32 million valuation allowance charge on assets held for sale relating to the initial estimated cost to sell the business.

An accumulated other comprehensive loss of approximately $ 350 million associated with the Air and Gas Handling business was included in the determination of the goodwill impairment charge, which is mostly attributable to the recognition of cumulative foreign currency translation effects from the long-term strengthening of the U.S.

The Company recorded a pre-tax gain on disposal of $ 14.2 million which is included in Loss from discontinued operations, net of taxes in the Consolidated Statements of Operations.

In connection with the purchase agreement, the Company entered into various agreements to provide a framework for its relationships after the disposition, including a transition services agreement.

The transition services under the above agreements have been completed and were not material to the Company’s results of operations.

The key components of Loss from discontinued operations, net of taxes related to the Air and Gas Handling business for the years ended December 31, 2021, 2020 and 2019 were as follows:

Separation of Fabrication Technology Business

On April 4, 2022, the Company completed the Separation of its fabrication technology business into an independent, publicly traded company:

ESAB, a global organization that develops, manufactures and supplies consumable welding and cutting products and equipment, as well as gas control equipment.

The spin-off was affected through a pro rata distribution of 90 % of the 60,034,311 outstanding common shares of ESAB to Enovis stockholders of record at the close of business on March 22, 2022 (the “Record Date”).

Enovis stockholders retained their Enovis shares and received one share of ESAB for every three shares of Enovis stock they owned on the Record Date.

ESAB began “regular way” trading on the New York Stock Exchange on April 5, 2022 under the symbol “ESAB”.

In connection with the Separation, the Company received a one-time tax-free cash distribution from ESAB of $ 1.2 billion.

In connection with the Separation, Enovis and ESAB entered into various agreements to effect the Separation and provide a framework for ESAB’s relationship with Enovis after the Separation.

These agreements include a separation and distribution agreement, a stockholders’ and registration rights agreement, an employee matters agreement, a tax matters agreement, a transition services agreement, an ESAB Business Excellence System (“EBS”) license agreement, and an intellectual property matters agreement (the “Agreements”).

These Agreements govern the Separation between Enovis and ESAB of the assets, employees, liabilities and obligations (including its investments, property and employee benefits and tax-related assets and liabilities) of Enovis and its subsidiaries attributable to periods prior to, at and after the Separation and will govern certain relationships between Enovis and ESAB after the Separation.

The impact of services to be provided to ESAB and agreed upon charges as part of the Separation are not expected to be material to our consolidated financial statements.

Asbestos Contingencies

The Company retained certain asbestos-related contingencies and insurance coverages from its previously divested businesses for which it did not retain an interest in the ongoing operations except for the contingencies.

The net costs and cash flows associated with these contingencies and coverages were reported by the Company as discontinued operations.

In conjunction with the Separation, all asbestos-related contingencies and insurance coverages from its divested businesses were transferred fully to ESAB.

The Company has classified asbestos-related charges through the date of Separation in its Condensed Consolidated Statements of Operations as part of Income from discontinued operations, net of taxes.

Income from discontinued operations, net of taxes on the Statements of Operations for the years ended December 31, 2022, 2021 and 2020 include pre-tax charges from previously retained asbestos-related contingencies of $ 3.2 million, $ 15.6 million and $ 10.6 million, respectively.

Subsequent to the Separation, the asbestos-related charges and asbestos assets and liabilities are no longer reflected in the Enovis financial statements.

Divestiture-related Expenses Related to our former Air and Gas Handling Business

The Company sold Air & Gas in 2019.

Accordingly, the accompanying Consolidated Financial Statements for all periods presented reflect the pre-tax divestiture-related expenses related to Air & Gas of $ 1.7 million, $ 9.1 million and $ 9.0 million for the years ended December 31, 2022, 2021 and 2020, respectively, as discontinued operations.

Summary of Items Treated as Discontinued Operations

As a result of the Separation and prior sale of Air & Gas, the operating results of (1) ESAB, the Company’s former fabrication technology business, (2) charges related to the previously retained asbestos contingencies and (3) Air & Gas divestiture-related expenses have been presented as discontinued operations in the Consolidated Statements of Operations for all periods presented.

Additionally, the Consolidated Balance Sheet as of December 31, 2021 presents the Assets and Liabilities of the fabrication technology business and asbestos contingencies as discontinued operations.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The carrying value of the assets and liabilities of the Company’s former fabrication technology business and asbestos contingencies amounts presented as discontinued operations as of December 31, 2021 was as follows:

December 31, 2021

(in thousands)

Cash and cash equivalents $ 39,118

Trade receivables, net 383,742

Inventories, net 420,062

Prepaid expenses 52,140

Other current assets 61,552

Total current assets 956,614

Property, plant and equipment, net 286,278

Goodwill 1,533,037

Other intangibles, net 521,434

Lease asset - right of use 107,944

Other assets 289,356

Total assets associated with discontinued operations (1)

Current portion of long-term debt $ 613

Accounts payable 348,965

Accrued liabilities 285,706

Total current liabilities 635,284

Long-term debt, less current portion 54

Non-current lease liability 88,777

Deferred tax liabilities 116,198

Other liabilities 368,533

Total liabilities associated with discontinued operations (1)

(1) Total assets and liabilities include asbestos-related contingencies and insurance coverages in connection to the sales of the Fluid Handling and Air & Gas businesses.

See Asbestos Contingencies section above for more information.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table presents the financial results of the former fabrication technology business including all divestiture-related expenses incurred by the company and allocated interest expense;

asbestos charges;

divestiture-related expenses related to Air & Gas;

and the combined income tax effect of those items for the years ended December 31, 2022, 2021 and 2020:

Year Ended December 31,

4 unchanged sentences

Selling, general and administrative expense 125,529 477,040 434,360

Restructuring and other related charges — — 13,354

Goodwill impairment charge — — 449,000

Divestiture-related expense (1)

Restructuring and other charges 5,304 18,954 21,632

Asbestos charges 3,194 15,578 10,619

Divestiture-related expenses (1)

46,684 29,668 9,040

Operating loss ( 9,121 ) ( 9,040 ) ( 395,794 )

Operating income 43,620 294,743 208,814

Interest expense (2)

Pension settlement loss — — 43,774

Gain on disposal — — 14,233

Loss from discontinued operations before income taxes ( 9,121 ) ( 9,040 ) ( 472,888 )

Income tax (benefit) expense (3)

8,035 43,481 51,438

Loss from discontinued operations, net of taxes (4)

Pension settlement gain — ( 11,208 ) —

Income from discontinued operations before income taxes 35,585 262,470 157,376

Income tax expense 9,155 83,939 37,178

Income from discontinued operations, net of taxes $ 26,430 $ 178,531 $ 120,198

(1) Divestiture-related expenses include $ 45.0 million and $ 20.6 million for the years ended December 31, 2022 and 2021, respectively, for the Separation.

(2) Interest expense was allocated to discontinued operations based on allocating $ 1.2 billion of corporate level debt to discontinued operations consistent with the dividend received from ESAB and the debt repaid at the time of the Separation.

Total income attributable to noncontrolling interest related to ESAB, net of taxes for the years ended December 31, 2022, 2021 and 2020, wa s $ 1.0 million , $ 3.6 million, and $ 2.5 million, respectively.

These amounts are presented as net income attributable to noncontrolling interest from discontinued operations - net of taxes on the Consolidated Statements of Operations.

The following table presents further detail into the financial results of the former fabrication technology business:

Year Ended December 31,

2022 2021 2020

(1) For the year ended December 31, 2021, Divestiture-related expenses are primarily related to a settlement executed in the first quarter of 2021.

For the years ended December 31, 2020 and 2019, Divestiture-related expenses are primarily related to professional, consulting, and legal fees associated with the divestiture including seller due diligence and preparation of regulatory filings, as well as other disposition-related activities.

(2) During the year ended December 31, 2019, the Company reclassified the portion of its interest expense associated with the mandatory pay down of the Term Loan Facilities using net proceeds from the sale of the business.

(3) Income tax expense for the year ended December 31, 2019 is largely due to nondeductible items that do not provide a tax benefit on the loss.

(4) Loss from discontinued operations, net of taxes on the Statements of Operations also includes the results from retained asbestos-related contingencies attributable to the divested fluid handling business as discussed in the Asbestos Contingencies section below.

COLFAX CORPORATION

(in thousands)

Depreciation 7,671 32,452 32,893

Amortization 9,012 41,954 41,798

Capital expenditures 5,903 35,584 40,138

Cash (used in) provided by operating activities related to discontinued operations for the years ended December 31, 2022, 2021 and 2020 wa s approximately $( 27 ) million, $ 224 million, and $ 302 million, respectively.

Cash used in investing activities related to discontinued operations for the years ended December 31, 2022, 2021 and 2020 was approximatel y $ 3 million, $ 35 million , and $ 35 million.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Total income attributable to noncontrolling interest related to the Air and Gas Handling business, net of taxes was $ 5.9 million for the year ended December 31, 2019.

This amount is presented within Income attributable to noncontrolling interest, net of taxes on the Consolidated Statements of Operations.

Cash used in operating activities related to the discontinued operations of the divested Air and Gas Handling business for the years ended December 31, 2021, 2020 and 2019 was $ 9.1 million, $ 9.4 million and $ 18.1 million, respectively.

Cash used in investing activities related to the discontinued operations of the divested Air and Gas Handling business was $ 27.5 million for the year ended December 31, 2019.

Asbestos Contingencies

As a result of previous divestitures, the Company retained certain asbestos-related contingencies and insurance coverages.

Loss from discontinued operations, net of taxes on the Statements of Operations for the years ended December 31, 2021, 2020 and 2019 includes a loss from retained asbestos-related contingencies of $ 16.2 million, $ 9.5 million, and $ 19.0 million, respectively.

Net cash inflows related to asbestos claims of divested businesses were $ 0.3 million for the year ended December 31, 2021.

Net cash outflows were $ 2.2 million and $ 3.2 million for the years ended December 31, 2020 and 2019, respectively.

See Note 18, “Commitments and Contingencies” for further information.

Acquisitions and Investments

2022 Acquisitions

The Company completed one acquisition in its Fabrication Technology segment and five acquisitions in its Medical Technology segment in 2021, for net cash consideration of $ 206.5 million and equity consideration of $ 285.7 million.

In 2022, the Company completed four asset acquisitions, two business acquisitions, and one investment, which is carried at cost as it does not have a readily determinable fair value.

Two of these transactions were completed by the Company’s Reconstructive segment, and the other five transactions were completed by the Prevention & Recovery segment.

The asset acquisitions broaden the Company’s product offering and distribution network.

Aggregate purchase consideration for the four asset acquisitions was $ 22.3 million, of which $ 12.6 million was paid in cash and $ 9.6 million consists of deferred and contingent consideration.

The investment was acquired for $ 10.0 million in cash consideration.

Pro forma revenues of the aforementioned acquisitions in the year ended December 31, 2022, if the aforementioned acquisitions were part of the Company since January 1, 2022, were approximately 1 % of Enovis consolidated revenues from continuing operations.

On May 6, 2022, the Company completed a business acquisition in its Reconstructive segment of KICo Knee Innovation Company Pty Limited and subsidiaries, an Australian private company doing business as 360 Med Care, by acquiring 100 % of its equity interests.

360 Med Care is a medical device distributor that bundles certain computer-assisted surgery and patient experience enhancement programs to add value to its device supply arrangements with surgeons, hospitals, and insurers.

The acquisition is accounted for under the acquisition method of accounting, and accordingly, the Condensed Consolidated Financial Statements include the financial position and results of operations from the acquisition date.

The Company paid $ 14.3 million for the acquisition, net of cash received, and recorded estimated contingent consideration at fair value of $ 12.8 million related to expected results over future revenue targets.

The Company has preliminarily allocated $ 16.3 million to Goodwill and $ 18.2 million to intangible assets acquired.

Purchase accounting procedures are ongoing and revisions to contingent consideration, intangible assets acquired, and adjustments for working capital true-ups may be recorded in future periods during the measurement period.

The 360 Med Care acquisition broadens our customer base in Australia and adds to our overall product offerings.

On July 5, 2022, the Reconstructive segment of the Company acquired a controlling interest of Insight Medical Systems (“Insight”).

Insight’s flagship solution, ARVIS, is an FDA-cleared augmented reality solution precisely engineered for the specific needs of hip and knee replacement surgery.

The ARVIS navigation unit consists of a hands-free heads-up display worn by the surgeon which provides surgical guidance at the point of care in a streamlined, space-conserving, and cost-effective manner compared to traditional robotic offerings.

The acquisition is accounted for under the acquisition method of accounting as a step-acquisition, and accordingly, the Condensed Consolidated Financial Statements include the financial position and results of operations from the acquisition date.

Enovis made initial investments in Insight in 2020 and 2021, which were carried at cost.

During the third quarter of 2022, the Company acquired an additional 53.7 % interest in Insight for $ 34.2 million net of cash received, and recorded contingent consideration of $ 5.0 million, which is the maximum payable under the agreement based on Insight’s achievement of certain milestones related to ARVIS.

As of December 31, 2022, Enovis holds a 99.5 % interest in Insight and recognized $ 0.3 million noncontrolling equity interest in its financial statements attributed to Insight.

The Company has preliminarily allocated $ 36.3 million to Goodwill and $ 38.4 million to intangible assets acquired.

Goodwill is primarily driven by expected synergies between ARVIS’ augmented reality surgical guidance system and our existing customer base and existing products.

The Company does not expect any of the Goodwill to be deductible for tax purposes.

As a result of obtaining control of Insight, the Company remeasured its initial investments to its fair value resulting in a $ 8.8 million gain.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

As of December 31, 2022, the balance of investments held by the company without readily determinable fair values was $ 16.5 million.

The investments are carried at cost minus impairments, if any, plus adjustments for fair value indicators from observable price changes in orderly transactions for the identical or similar investment of the same issuer.

There have been no impairments or upward adjustments in the current year or since acquisition of the investments except for the gain on our previously held equity investment in Insight discussed above.

As a result of acquiring control of Insight, Enovis now consolidates the assets, liabilities, and results of operations of Insight and therefore current year and previous investments in Insight of $ 16.6 million are no longer recorded as cost basis investments.

2021 Acquisitions

The Company completed five acquisitions in its Reconstructive segment in 2021, for net cash consideration of $ 201.6 million and equity consideration of $ 285.7 million.

The acquisitions are accounted for under the acquisition method of accounting, and accordingly, the Consolidated Financial Statements include the financial position and results of operations from the respective acquisition date.

The Consolidated Balance Sheet as of December 31, 2022 reflects our estimates of fair value and are subject to adjustment for certain of the acquisitions as discussed below.

The estimated proforma annual revenues of the acquisitions in the year ended December 31, 2021 are approximately 5 % of Colfax consolidated revenues.

Pro forma revenues of the aforementioned acquisitions in the year ended December 31, 2021, if the aforementioned acquisitions were part of the Company since January 1, 2021, were approximately 12 % of Enovis consolidated revenues from continuing operations.

The Company also made three investments during the year ended December 31, 2021 for a total of $ 16.8 million.

These investments are carried at cost as they do not have a readily determinable fair value.

On January 19, 2021, the Medical Technology segment acquired Trilliant Surgical (“Trilliant”), a national provider of foot and ankle orthopedic implants.

The product technologies of Trilliant support the Medical Technology segment’s focused expansion into the adjacent foot and ankle market.

On January 19, 2021, the Reconstructive segment acquired Trilliant Surgical (“Trilliant”), a national provider of foot and ankle orthopedic implants.

The product technologies of Trilliant support the Reconstructive segment’s focused expansion into the adjacent foot and ankle market.

Trilliant has a broad product portfolio that covers the full universe of foot reconstructive and fixation procedures, and includes the novel Arsenal Foot Plating System, designed for greater flexibility and speed of implant placement.

On April 23, 2021, the Medical Technology segment acquired MedShape, Inc.

On April 23, 2021, the Reconstructive segment acquired MedShape, Inc.

(“MedShape”), a provider of innovative surgical solutions for foot and ankle surgeons using its patented superelastic nickel titanium (NiTiNOL) and shape memory polymer technologies.

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Expected synergies between Trilliant, MedShape, and DJO through this portfolio of foot and ankle products and cross-selling to existing and acquired customers are primary drivers of the acquired Goodwill.

The estimated pro-forma revenues of the Trilliant and MedShape acquisitions are approximately 1 % of Colfax’s consolidated revenues.

Pro forma revenue of the Trilliant and MedShape acquisitions were approximately 3 % of Enovis’ consolidated revenues from continuing operations.

The purchase accounting related to the Trilliant and MedShape acquisitions has been completed.

On July 28, 2021, the Medical Technology segment acquired Mathys AG Bettlach (“Mathys”) for total acquisition equity consideration of $ 285.7 million of Colfax Common stock, which included cash acquired of $ 14.7 million.

On July 28, 2021, the Reconstructive segment acquired Mathys AG Bettlach (“Mathys”) for total acquisition equity consideration of $ 285.7 million of Enovis Common stock, which included cash acquired of $ 14.7 million.

Mathys, a Switzerland-based company, develops and distributes innovative products for artificial joint replacement, synthetic bone graft solutions and sports medicine.

The acquisition expands the Medical Technology segment’s reconstructive product portfolio with Mathys’ complimentary surgical solutions and broadens its international customer base.

The following table summarizes the Company’s best estimate of the aggregate fair value of assets acquired and liabilities assumed at the date of the Mathys acquisition.

These amounts, including inventories, deferred taxes, intangibles assets, useful lives of the intangible assets and property, plant and equipment, are determined based upon certain valuations and studies that

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

have yet to be finalized.

Accordingly, the assets acquired and liabilities assumed, as detailed below, are subject to adjustment once the detailed analysis are completed, which could be material.

None of the Goodwill recognized is expected to be deductible for income tax purposes.

The acquisition expands the Reconstructive segment’s reconstructive product portfolio with Mathys’ complimentary surgical solutions and broadens its international customer base.

Purchase accounting procedures for this acquisition have been completed and the finalized allocation of the aggregate fair value of assets acquired and liabilities assumed as of the date of the Mathys acquisition are presented below.

No ne of the Goodwill recognized is expected to be deductible for income tax purposes.

Goodwill recognized for the Mathys acquisition is primarily attributable to synergies from cross-selling DJO products with the acquired customers and cost savings through supply chain management.

The following table summarizes the final allocation of consideration related to the Mathys acquisition as of the acquisition date:

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

July 28, 2021

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Property, plant and equipment 58,465

Other assets 16,822

Goodwill 92,438

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Accounts payable ( 4,808 )

Accrued and other current liabilities ( 33,254 )

Non-current deferred tax liabilities ( 30,022 )

Non-current pension liabilities ( 25,536 )

Other liabilities ( 4,327 )

Other assets and liabilities, net ( 77,494 )

Consideration, net of cash acquired $ 271,003

The following table summarizes Intangible assets acquired, excluding Goodwill, as of July 28, 2021:

The following table summarizes Intangible assets acquired in the Mathys acquisition, excluding Goodwill, as of the acquisition date:

Intangible Amortization

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2020 Acquisitions

Our Medical Technology segment completed five acquisitions in 2020 for total consideration, net of cash received, of $ 67.5 million.

Our Reconstructive segment completed five acquisitions in 2020 for total consideration, net of cash received, of $ 67.5 million.

Total Goodwill acquired through the acquisitions was $ 21.4 million, of which $ 15.9 million is expected to be deductible for income tax purposes.

Acquisitions in our Medical Technology segment included LiteCure LLC (“LiteCure”), a U.S.

Acquisitions in our Prevention & Recovery segment included LiteCure LLC (“LiteCure”), a U.S.

leader in high-powered laser rehabilitation products for human and veterinary medical applications.

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Net working capital and intangible assets acquired represent 10 % and 69 % of the total consideration paid, respectively, with the residual amount primarily attributable to Goodwill.

DJO Acquisition in 2019

The Medical Technology segment platform at Colfax was established on February 22, 2019 when Colfax completed the acquisition of DJO.

The Company paid an aggregate net purchase price of $ 3.15 billion.

The Company incurred $ 2.8 million and $ 60.8 million of advisory, legal, audit, valuation and other professional service fees in connection with the DJO acquisition in the years ended December 31, 2020 and 2019, respectively which are included in Selling, general and administrative expense in the Consolidated Statements of Operations.

During the first quarter of 2020, as part of the fair value adjustments to the assets and liabilities acquired, the Company increased the valuation allowance on U.S.

deferred taxes, presented net within Other

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

liabilities, by $ 51.4 million as of the acquisition date, with a corresponding increase to Goodwill.

The accounting related to the DJO acquisition was finalized as of the end of the first quarter of 2020.

The following unaudited proforma financial information presents Colfax’s consolidated financial information for the years ended December 31, 2020 and 2019 assuming the acquisition had taken place on January 1, 2019.

These amounts are presented in accordance with U.S.

GAAP, consistent with the Company’s accounting policies.

Year Ended December 31,

(In thousands)

Net sales $ 3,070,769 $ 3,496,624

Net income from continuing operations attributable to Colfax Corporation 68,039 105,491

For the years ended December 31, 2021, 2020, and 2019, Net sales associated with acquisitions consummated during each period were $ 96.0 million, $ 7.1 million, and $ 1,080.4 million, respectively.

2021 Net loss attributable to current year acquisitions was $ 17.7 million, which includes $ 18.6 million amortization expense for inventory fair value adjustments and acquired intangible assets.

Net Income attributable to Colfax Corporation common shareholders associated with acquisitions consummated during the year ended December 31, 2020 was not material.

Net Income attributable to Colfax Corporation common shareholders associated with the DJO acquisition consummated during the year ended December 31, 2019 was $ 57.3 million.

The Company’s Fabrication Technology segment develops, manufactures and supplies consumable welding and cutting products and equipment as well as gas control equipment.

The segment provides a wide range of products with innovative technologies to solve challenges in a range of industries, including cutting, joining and automated welding.

Substantially all revenue from the Fabrication Technology business is recognized at a point in time.

The Company further disaggregates its Fabrication Technology revenue into the following product groups:

Year Ended December 31,

2021 2020 2019

(In thousands)

Equipment $ 758,267 $ 607,504 $ 703,024

Consumables 1,669,848 1,342,565 1,544,002

Total $ 2,428,115 $ 1,950,069 $ 2,247,026

The consumables product grouping generally has less production complexity and shorter production cycles than equipment products.

The Company’s Medical Technology segment provides orthopedic solutions, including products and services spanning the full continuum of patient care, from injury prevention to rehabilitation.

While the Company’s Medical Technology sales are primarily derived from three sales channels including dealers and distributors, insurance, and direct to consumers and hospitals, substantially all its revenue is recognized at a point in time.

The Company disaggregates its Medical Technology revenue into the following product groups:

COLFAX CORPORATION

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company provides orthopedic solutions, including products and services spanning the full continuum of patient care, from injury prevention to rehabilitation.

While the Company’s sales are primarily derived from three sales channels including dealers and distributors, insurance, and direct to consumers and hospitals, substantially all its revenue is recognized at a point in time.

The Company disaggregates its revenue into the following segments:

Year Ended December 31,

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Prevention & Recovery:

Bracing & Support $ 437,287 $ 432,963 $ 379,236

Other P&R 255,305 243,051 188,107

International P&R (1)

335,036 350,015 295,806

Total Prevention & Recovery 1,027,628 1,026,029 863,150

Reconstructive:

Reconstructive 370,173 323,187 245,215

International Reconstructive 165,300 76,972 12,335

Total Reconstructive 535,473 400,159 257,550

Total $ 1,563,101 $ 1,426,188 $ 1,120,700

(1) For the year ended December 31, 2019, the Medical Technology segment includes results from the acquisition date of February 22, 2019.

(2) For the years presented, the Prevention & Recovery product group includes bone growth stimulation products, which were previously classified as part of the Reconstructive product group.

Given the nature of the Fabrication Technology and Medical Technology businesses, the total amount of unsatisfied performance obligations with an original contract duration of greater than one year as of December 31, 2021 is immaterial.

(1) The year ended December 31, 2022 includes the unfavorable impact of $ 30.9 million of currency.

Given the nature of the businesses, the Company does not generally have unsatisfied performance obligations with an original contract duration of greater than one year.

The nature of the Company’s contracts gives rise to certain types of variable consideration, including rebates, implicit price

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The Company includes estimated amounts of variable consideration in the transaction price to the extent that it is probable there will not be a significant reversal of revenue.

In some circumstances, customers are billed in advance of revenue recognition, resulting in contract liabilities.

As of December 31, 2021, 2020 and 2019, total contract liabilities were $ 31.5 million, $ 36.6 million and $ 14.8 million, respectively.

Contract liabilities are included in Accrued liabilities on the Company’s Consolidated Balance Sheets.

During the years ended December 31, 2021 and 2020, revenue recognized that was included in the contract liability balance at the beginning of the year was $ 29.3 million and $ 14.8 million, respectively.

The contract liabilities as of December 31, 2021 and December 31, 2020 included $ 4.9 million and $ 11.8 million, respectively, of certain one-time advance payments in the Medical Technology business.

Allowance for Credit Losses

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The expected credit loss model further considers current conditions and reasonable and supportable forecasts using an adjustment for current and projected macroeconomic factors.

Management identified appropriate macroeconomic indicators based on tangible correlation to historical losses considering the location and risks associated with the Company.

Management identified appropriate macroeconomic indicators based on a tangible correlation to historical losses considering the location and risks associated with the Company.

A summary of the activity in the Company’s allowance for credit losses included within Trade receivables in the Consolidated Balance Sheets is as follows:

Year Ended December 31, 2022

of Period Charged to Expense, net Write-Offs and Deductions Foreign

of Period Charged to Expense, net Write-Offs, Deductions and Other, net Foreign

Translation Balance at

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Allowance for credit losses $ 6,589 $ 2,552 $ ( 963 ) $ ( 213 ) $ 7,965

COLFAX CORPORATION

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

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(In thousands, except share and per share data)

Computation of Net income per share from continuing operations - basic:

Net income from continuing operations attributable to Colfax Corporation (1)

Computation of Net income (loss) per share from continuing operations - basic:

Net income (loss) from continuing operations attributable to Enovis Corporation (1)

$ ( 38,756 ) $ ( 103,305 ) $ ( 75,119 )

1 unchanged sentence

54,065,420 51,141,210 45,588,708

Net income per share from continuing operations – basic

Net income (loss) per share from continuing operations – basic

$ ( 0.72 ) $ ( 2.02 ) $ ( 1.65 )

Computation of Net income per share from continuing operations - diluted:

Net income from continuing operations attributable to Colfax Corporation (1)

Computation of Net income (loss) per share from continuing operations - diluted:

Net income (loss) from continuing operations attributable to Enovis Corporation (1)

$ ( 38,756 ) $ ( 103,305 ) $ ( 75,119 )

1 unchanged sentence

54,065,420 51,141,210 45,588,708

Net effect of potentially dilutive securities - stock options, restricted stock units and tangible equity units 2,118,509 2,144,304 949,942

Net effect of potentially dilutive securities - stock options and restricted stock units — — —

Weighted-average shares of Common stock outstanding – diluted

54,065,420 51,141,210 45,588,708

Net income per share from continuing operations – diluted

Net income (loss) per share from continuing operations – diluted

$ ( 0.72 ) $ ( 2.02 ) $ ( 1.65 )

(1) Net income from continuing operations attributable to Colfax Corporation for the respective periods is calculated using Net income from continuing operations less the income attributable to noncontrolling interest, net of taxes, of $ 4.6 million, $ 3.1 million, and $ 4.6 million for the years ended December 31, 2021, 2020 and 2019, respectively.

For all periods presented, the weighted-average shares of Common stock outstanding - basic includes the impact of 18.4 million shares related to the issuance of Colfax’s tangible equity units.

During the year ended December 31, 2021, conversions of the Company’s tangible equity units resulted in the issuance of approximately 13.3 million shares of Colfax common stock.

All issuances of Colfax common stock related to the tangible equity units were converted at the minimum settlement rate of 4.0000 shares of common stock for each purchase contract as a result of the Company’s share price.

For the year ended December 31, 2020, the weighted-average shares of Common stock outstanding - diluted includes the impact of an additional 0.9 million potentially issuable dilutive shares related to Colfax’s tangible equity units as a result of the Company’s share price in March 2020.

(1) Net income from continuing operations attributable to Enovis Corporation for the respective periods is calculated using Net income from continuing operations less the income attributable to noncontrolling interest from continuing operations, net of taxes, of $ 0.6 million, $ 1.1 million and $ 0.7 million for the years ended December 31, 2022, 2021 and 2020, respectively.

As a result of the one-for-three reverse stock split immediately following the Separation, all share and per share figures contained in the Consolidated Financial Statements have been retroactively restated as if the reverse stock split occurred at the beginning of the periods presented.

For the years ended December 31, 2021 and December 31, 2020, the weighted-average shares of Common stock outstanding - basic includes the impact of 6.1 million shares, as adjusted for the reverse stock split, for the actual or potential issuance of shares from tangible equity unit purchase contracts.

In January 2022, the final remaining amount of tangible equity unit purchase contracts were converted into approximately 1.7 million shares of the Company’s common stock, as adjusted for the reverse stock split.

All the issued shares are included in the Common stock issued and outstanding as of December 31, 2022.

See Note 14, “Equity”, for details.

For the year ended December 31, 2021, conversions of the Company’s tangible equity units resulted in the issuance of approximately 4.4 million shares, as adjusted for the reverse stock split, of Common stock.

All issuances of C ommon stock related to the tangible equity units were converted at the minimum settlement rate of 4.0000 shares of Common stock for each purchase contract as a result of the Company’s share price.

For the year ended December 31, 2020, the weighted-average shares of Common stock outstanding - diluted includes the impact of an additional 0.3 million potentially issuable dilutive shares, as adjusted for the reverse stock split, related to tangible equity units as a result of the Company’s share price.

See Note 14, “Equity”, for details.

The weighted-average computation of the dilutive effect of potentially issuable shares of Common stock under the treasury stock method for the years ended December 31, 2022, 2021 and 2020 excludes 1.1 million, 0.3 million and 1.4 million outstanding stock-based compensation awards, respectively, as their inclusion would be anti-dilutive.

COLFAX CORPORATION

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Income from continuing operations before income taxes and Income tax expense (benefit) consisted of the following:

Loss from continuing operations before income taxes and Income tax expense (benefit) consisted of the following:

Year Ended December 31,

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(In thousands)

Income from continuing operations before income taxes:

Income (loss) from continuing operations before income taxes:

Domestic operations $ 8,826 $ ( 129,903 ) $ ( 136,455 )

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See Note 4, “Discontinued Operations” for the loss from discontinued operations and related income taxes.

On December 22, 2017, the Tax Act was signed into law making significant changes to the Internal Revenue Code which included how the U.S.

imposes income tax on multinational corporations.

In 2020 the Company timely filed changes to U.S.

federal tax returns to credit rather than to deduct foreign taxes and reduced its transition tax by $ 6.8 million.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company’s Income tax expense (benefit) from continuing operations differs from the amount that would be computed by applying the U.S.

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Effect of tax rates on international operations ( 5,106 ) 681 ( 5,246 )

Change in enacted international tax rates ( 12,104 ) ( 1,023 ) ( 2,843 )

Changes in valuation allowance ( 12,126 ) ( 4,496 ) ( 20,327 )

Changes in tax reserves 1,724 ( 2,332 ) 2,168

Tax Act - mandatory repatriation taxes — ( 6,766 ) —

Research and development tax credits ( 2,599 ) ( 2,392 ) ( 2,248 )

Foreign tax credits ( 15,265 ) ( 12,197 ) ( 15,299 )

Net items not deductible in an international jurisdiction 1,859 772 40

SubPart F and GILTI 50,522 27,797 29,407

Deal Costs and other non-deductibles 459 38 5,556

tax on international operations 4,565 14,865 1,873

Transaction related costs 27,699 — —

Withholding taxes 495 556 854

Non-deductible employee compensation 9,013 2,562 4,450

Capital gains 12,052 — —

Other 153 303 ( 713 )

Income tax expense (benefit) $ 36,120 $ ( 19,528 ) $ ( 44,579 )

The valuation allowance benefit reflected above is predominately the utilization of net operating losses in the current period.

Certain movements of valuation allowance, particularly related to repatriation taxes, foreign tax credits, SubPart F and GILTI, and withholding taxes have been aggregated with that particular line item within the rate reconciliation.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Deferred income taxes, net reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse.

The significant components of deferred tax assets and liabilities included in continuing operations, in addition to the reconciliation of the beginning and ending amount of gross unrecognized tax benefits, are as follows:

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The significant components of deferred tax assets and liabilities included in continuing operations are as follows:

(In thousands)

Deferred tax assets:

Post-retirement benefit obligation $ 5,418 $ 11,617

Expenses currently not deductible $ 37,159 $ 42,297

Net operating loss carryforward 286,047 308,965

Net operating loss and interest expense limitation carryforward 162,713 285,009

Tax credit carryforward 37,883 26,960

Depreciation and amortization 28,659 1,058

Inventory 3,061 —

Capitalized R&D expenditures 29,579 23,281

Non-current lease liability 17,815 21,066

Other 2,171 1,680

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Depreciation and amortization ( 237,374 ) ( 269,929 )

Inventory — ( 1,559 )

Outside basis differences and other ( 119,452 ) ( 78,012 )

Lease asset - right of use ( 17,380 ) ( 20,702 )

Total deferred tax liabilities ( 254,754 ) ( 290,631 )

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To the extent a portion or all of the applicable deferred tax assets do not meet the more likely than not threshold, a valuation allowance is recorded.

During the year ended December 31, 2021, the valuation allowance decreased from $ 203.3 million to $ 193.5 million with a net decrease of $ 10.3 million recognized in Income tax expense (benefit), $ 1.3 million increase attributed to acquisitions, and a $ 0.8 million decrease related to changes in foreign currency rates.

During the year ended December 31, 2022, the valuation allowance decreased from $ 111.8 million to $ 93.5 million with a net decrease of $ 12.1 million recognized in Income tax expense (benefit) and a $ 6.7 million decrease related to changes in foreign currency rates.

Consideration was given to tax planning strategies and, when applicable, future taxable income as to how much of the relevant deferred tax asset could be realized on a more likely than not basis.

The Company has U.S.

net operating loss carryforwards of $ 462.7 million expiring in years 2022 through 2037 and $ 102.2 million that may be carried forward indefinitely.

net operating loss carryforwards of $ 31.2 million expiring in years 2023 through 2037 and $ 26.3 million that may be carried forward indefinitely and U.S.

interest limitation carryforward of $ 55.7 million that may be carried forward indefinitely.

The Company’s ability to use these various carryforwards to offset any taxable income generated in future taxable periods may be limited under Section 382 and other federal tax provisions.

As of December 31, 2021, the Company also has $ 528.1 million foreign net operating loss carryforwards primarily in Brazil, Germany, Sweden, and the United Kingdom that may be subject to local tax limitations including changes in ownership.

As of December 31, 2022, the Company had $ 16.6 million foreign net operating loss carryforwards primarily in Germany, France, and the United Kingdom that may be subject to local tax limitations including changes in ownership.

The foreign net operating losses can be carried forward indefinitely, except in applicable jurisdictions that make up less than five percent of the available net operating losses.

The company has $ 32.9 million of foreign interest limitation carryforward primarily in Germany, that may be carried forward indefinitely.

The Company has U.S.

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tax in previous or future tax periods subject to Section 382 and other federal provisions.

The Company’s $ 22.5 million foreign tax credit can be carried back one year and can be carried forward to tax years through 2026-2030.

The Company’s $ 16.6 million R&D credit can be carried back one year and can be carried forward to tax years through 2022-2041.

For the year ended December 31, 2021, all undistributed earnings of the Company’s foreign subsidiaries, which are indefinitely reinvested outside the U.S., were provisionally estimated to be $ 189.2 million.

The Company has assessed a total deferred tax liability of $ 0.2 million as of December 31, 2021 on such earnings that have not been indefinitely reinvested.

This is a decrease of $ 1.7 million as compared to the deferred tax liability as of December 31, 2020.

COLFAX CORPORATION

The Company’s $ 24.3 million foreign tax credit can be carried back one year and carried forward to tax years 2023 through 2031.

The Company’s $ 9.3 million R&D credit can be carried back one year and carried forward to tax years 2023 through 2042.

For the year ended December 31, 2022, undistributed earnings of the Company’s foreign subsidiaries are estimated to be $ 50.9 million, all of which is permanently reinvested;

accordingly, the Company has assessed no deferred tax liability as of December 31, 2022 on such earnings.

This is a decrease of $ 0.2 million as compared to the deferred tax liability as of December 31, 2021, which was transferred as part of the divestiture of ESAB.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company records a liability for unrecognized income tax benefits for the amount of benefit included in its previously filed income tax returns and in its financial results expected to be included in income tax returns to be filed for periods through the date of its Consolidated Financial Statements for income tax positions for which it is not more likely than not to be sustained upon examination by the respective taxing authority.

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows (inclusive of associated interest and penalties):

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:

(In thousands)

Balance, January 1, 2020 $ 55,480

Acquisitions and divestitures 18,248

Addition for tax positions taken in prior periods 5,911

2 unchanged sentences

Reductions resulting from a lapse of applicable statute of limitations ( 5,689 )

Other, including the impact of foreign currency translation and U.S.

tax rate changes ( 123 )

Other, including the impact of foreign currency translation 332

Balance, December 31, 2020 58,014

Acquisitions and divestitures 4,450

Addition for tax positions taken in prior periods 228

2 unchanged sentences

Reductions resulting from a lapse of applicable statute of limitations ( 3,239 )

Other, including the impact of foreign currency translation and U.S.

tax rate changes 332

Other, including the impact of foreign currency translation ( 734 )

Balance, December 31, 2021 61,947

Acquisitions and divestitures ( 23,250 )

Addition for tax positions taken in prior periods 228

Addition for tax positions taken in the current period 462

Reductions related to settlements with taxing authorities ( 425 )

Reductions resulting from a lapse of applicable statute of limitations ( 244 )

Other, including the impact of foreign currency translation and U.S.

tax rate changes ( 734 )

Other, including the impact of foreign currency translation ( 616 )

Balance, December 31, 2022 $ 38,299

The Company is routinely examined by tax authorities around the world.

Tax examinations remain in process in multiple countries, including but not limited to Brazil, Germany, Italy, Indonesia, Sweden, Switzerland, the United States and various U.S.

Tax examinations remain in process in multiple countries, including but not limited to Germany, China, the United States and various U.S.

The Company files numerous group and separate tax returns in U.S.

2 unchanged sentences

With some exceptions, other major tax jurisdictions generally are not subject to tax examinations for years beginning before 2016.

The Company’s total unrecognized tax benefits were $ 61.9 million and $ 58.0 million as of December 31, 2021 and 2020, respectively, inclusive of $ 7.5 million and $ 6.9 million, respectively, of interest and penalties.

The Company records interest and penalties on uncertain tax positions as a component of Income tax expense (benefit), which was $ 1.1 million, $ 0.6 million and $ 0.7 million for the years ended December 31, 2022, 2021 and 2020, respectively.

As of December 31, 2022 and 2021, we had accrued $ 4.2 million and $ 7.5 million, respectively, of interest and penalties related to unrecognized tax benefits.

Due to the difficulty in predicting with reasonable certainty when tax audits will be fully resolved and closed, the range of reasonably possible significant increases or decreases in the liability for unrecognized tax benefits that may occur within the next 12 months is difficult to ascertain.

Currently, the Company estimates that it is reasonably possible that the expiration of various statutes of limitations, resolution of tax audits and court decisions may reduce its tax expense in the next 12 months up to $ 1.7 million.

COLFAX CORPORATION

The gross amount of the unrecognized tax benefits that, if recognized, would affect the Company’s effective tax rate was $ 26.9 million as of December 31, 2022.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

1 unchanged sentence

The following table summarizes the activity in Goodwill, by segment during the years ended December 31, 2022 and 2021:

Medical Technology Fabrication

Technology Total

Prevention & Recovery Reconstructive Total

(In thousands)

9 unchanged sentences

(1) Includes purchase accounting adjustments associated with acquisitions discussed in Note 5, “Acquisitions”.

See Note 4, “Discontinued Operations” for discussion of the impairment on the Air and Gas Handling business recorded in 2019 as part of the divestiture, which is presented within Loss from discontinued operations, net of taxes on the Consolidated Statements of Operations.

The following table summarizes the Company’s Intangible assets, excluding Goodwill:

3 unchanged sentences

(In thousands)

Indefinite-Lived Intangible Assets

Trade names $ 199,484 $ — $ 212,048 $ —

Definite-Lived Intangible Assets

5 unchanged sentences

$ 1,578,862 $ ( 468,135 ) $ 1,486,228 $ ( 332,200 )

Amortization expense related to intangible assets of $ 167.7 million, $ 158.4 million, and $ 135.8 million are included in the Selling, general, and administrative expense in the Consolidated Statements of Operations for the years ended December 31, 2021, 2020, and 2019, respectively.

Amortization expense related to acquired intangible assets, including acquired customer relationships, acquired technology, and acquired trade names, are presented on the face of the Consolidated Statements of Operations.

Other intangible assets amortization expense consists primarily of amortization of software intangibles and is recorded as a component of Selling, general, and administrative expense in the Consolidated Statements of Operations.

Total amortization expense is $ 133.7 million, $ 125.0 million, and $ 115.9 million for the years ended December 31, 2022, 2021 and 2020, respectively.

See Note 2, “Summary of Significant Accounting Policies” for discussion regarding impairment of Intangible assets.

COLFAX CORPORATION

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

15 unchanged sentences

$ 236,741 $ 235,113

Depreciation expense for the years ended December 31, 2021, 2020 and 2019, was $ 93.7 million, $ 85.5 million and $ 76.1 million, respectively.

Impairment of fixed assets recorded for the years ended December 31, 2021, 2020 and 2019 wa s $ 1.5 million, $ 2.1 million and $ 0.5 million, respectively.

Depreciation expense for the years ended December 31, 2022, 2021 and 2020, w as $ 69.2 million, $ 62.0 million and $ 52.0 million, respectively.

Inventories, Net

Inventories, net consisted of the following:

2021 2020 (1)

(In thousands)

3 unchanged sentences

485,345 394,780

LIFO reserve 1,129 13,851

allowance for excess, slow-moving and obsolete inventory ( 58,702 ) ( 38,547 )

$ 426,643 $ 356,233

(1) Certain immaterial classification adjustments were made to enhance conformity with the current year presentation.

The valuation of LIFO inventories is made at the end of the year based on inventory levels and costs at that time.

At December 31, 2021 and 2020, approximately 18.3 % and 18.6 % of total inventories, respectively, were valued using the LIFO method.

COLFAX CORPORATION

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

11 unchanged sentences

Thereafter 14,991

Total 214,335

present value discount ( 6,522 )

11 unchanged sentences

TEU amortizing notes — 6,501

2024 and 2026 notes 297,906 991,319

2026 notes — 297,906

Revolving credit facilities and other 40,000 603,932

2 unchanged sentences

Long-term debt $ 40,000 $ 2,078,625

Term Loan and Revolving Credit Facility

The Company’s credit agreement (the “Credit Facility”) by and among the Company, as the borrower, certain U.S.

subsidiaries of the Company, as guarantors, each of the lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent, Citizens Bank, N.A., as syndication agent, and the co-documentation agents named therein consists of a $ 975 million revolving credit facility (the “Revolver”) and a Term A-1 loan with an initial aggregate principal amount of $ 825 million (the

COLFAX CORPORATION

Debt Redemptions in Connection with the Separation

In conjunction with the Separation which occurred on April 4, 2022, the Company repaid all obligations under its previous credit agreement and entered into a new credit agreement (the “Enovis Credit Agreement”) with certain of its existing bank lenders.

Additionally, on April 7, 2022 after the completion of the Separation, the Company completed the redemptions of its

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

“Term Loan”), each with a maturity date of December 6, 2024.

3.25 % Euro Senior Notes due 2025 and its 6.375 % Senior Notes due 2026.

As a result of these changes, the Company recorded Debt extinguishment charges of $ 20.1 million in the second quarter of 2022, comprised of $ 12.7 million in redemption premiums and $ 7.4 million in noncash write-offs of original issue discount and deferred financing fees.

Enovis Term Loan and Revolving Credit Facility

The Enovis Credit Agreement consists of a $ 900 million revolving credit facility (the “Revolver”) with an April 4, 2027 maturity date and a term loan with an initial aggregate principal amount of $ 450 million and an April 4, 2023 maturity date (the “Enovis Term Loan”).

The Revolver contains a $ 50 million swing line loan sub-facility.

subsidiaries of the Company guarantee the obligations under the Credit Facility.

The Credit Facility contains customary covenants limiting the ability of Colfax and its subsidiaries to, among other things, incur debt or liens, merge or consolidate with others, dispose of assets, make investments or pay dividends.

In addition, the Credit Facility contains financial covenants requiring Colfax to maintain (subject to certain exceptions) (i) a maximum total leverage ratio, calculated as the ratio of Consolidated Net Debt (as defined in the Credit Facility) to EBITDA (as defined in the Credit Facility) of 4.25 :1.00 for the quarters ending December 31, 2021 and March 31, 2022, 4.00 :1.00 for the quarters ending June 30, 2022 and September 30, 2022, and 3.50 :1.00 as of December 31, 2022 and for each fiscal quarter ending thereafter, and (ii) a minimum interest coverage ratio of 3.00 :1.00 for the quarter ending September 30, 2021 and thereafter.

The Credit Facility also includes a “springing” collateral provision (based upon the Gross Leverage Ratio as defined in the Amendment to the Credit Facility) which requires the obligations under the Amendment to the Credit Facility to be secured by substantially all personal property of Colfax and its U.S.

subsidiaries and the equity of its first tier foreign subsidiaries, subject to customary exceptions, in the event Colfax’s Gross Leverage Ratio under the Credit Facility is greater than 5.00 :1.00 as of the last day of any fiscal quarter.

The Credit Facility contains various events of default (including failure to comply with the covenants under the Credit Facility and related agreements) and upon an event of default the lenders may, subject to various customary cure rights, require the immediate payment of all amounts outstanding under the Term Loan Facilities and the Revolver.

As of December 31, 2021, the Company was in compliance with the covenants under the Credit Facility.

As of December 31, 2021, the weighted-average interest rate of borrowings under the Credit Facility was 1.59 %, excluding accretion of original issue discount and deferred financing fees, and there was $ 375 million undrawn capacity available on the Revolver.

On November 18, 2022, the Company completed an exchange with a lender under the Enovis Credit Agreement of 6,003,431 shares of common stock of ESAB, representing all of the retained shares in ESAB following the Separation, for $ 230.5 million of the $ 450.0 million in term loan outstanding under the Credit Agreement, net of cost to sell.

The Enovis Credit Agreement contains customary covenants limiting the ability of the Company and its subsidiaries to, among other things, incur debt or liens, merge or consolidate with others, dispose of assets, make investments or pay dividends.

In addition, the Enovis Credit Agreement contains financial covenants requiring the Company to maintain (i) a maximum total leverage ratio of not more than 4.00 :1.00, with a step-down to 3.75 :1.00 commencing with the fiscal quarter ending June 30, 2023, and a step-down to 3.50 :1.00 commencing with the fiscal quarter ending June 30, 2024, and (ii) a minimum interest coverage ratio of 3.00 :1.00.

The Enovis Credit Agreement contains various events of default (including failure to comply with the covenants under the Enovis Credit Agreement and related agreements) and upon an event of default the lenders may, subject to various customary cure rights, require the immediate payment of all amounts outstanding under the Enovis Term Loan and the Enovis Revolver.

As of December 31, 2022, the Company was in compliance with the covenants under the Enovis Credit Agreement.

As of December 31, 2022, the weighted-average interest rate of borrowings under the Enovis Credit Agreement was 5.71 %, excluding accretion of original issue discount and deferred financing fees, and there was $ 860.0 million available on the Revolver.

The Company has $ 4.7 million in deferred financing fees recorded in conjunction with the Credit Facility as of December 31, 2022, which is being accreted to Interest expense, net primarily using the effective interest method over the life of the facility.

Euro Senior Notes

The Company has senior unsecured notes with an aggregate principal amount of € 350 million (the “Euro Notes”).

The Euro Notes are due in April 2025, have an interest rate of 3.25 % and are guaranteed by certain of our domestic subsidiaries (the “Guarantees”).

The Euro Notes and the Guarantees have not been, and will not be, registered under the Securities Act of 1933, as amended, or the securities laws of any other jurisdiction.

The Company had senior unsecured notes with an aggregate principal amount of € 350 million due in May 2025, with an interest rate of 3.25 %.

The Euro Senior Notes were redeemed on April 7, 2022 at a 100.813 % redemption premium after the completion of the Separation.

Tangible Equity Unit (“TEU”) Amortizing Notes

On January 11, 2019, the Company issued $ 460 million in TEUs with a 5.75 % interest rate, comprised of 4.6 million units at the stated amount of $ 100 per unit.

Total cash of $ 447.7 million was received upon closing, comprised of $ 377.8 million TEU prepaid stock purchase contracts and $ 69.9 million of TEU amortizing notes due January 2022.

The proceeds were used to finance a portion of the purchase price for the DJO acquisition and for general corporate purposes.

Refer to Note 14, “Equity” for additional information on the TEU prepaid stock purchase contracts.

Each TEU amortizing note had an initial principal amount of $ 15.6099 , bearing interest at a rate of 6.50 % per annum, and had equal quarterly cash installments of $ 1.4375 per TEU amortizing note with a final installment payment date of January 15, 2022.

The quarterly cash installment constituted a payment of interest and a partial repayment of principal.

The Company previously had 6.50 % TEU amortizing notes due in January 2022 at an initial principal amount of $ 15.6099 per note with equal quarterly cash installments of $ 1.4375 per note representing a payment of interest and partial payment of principal.

The Company paid $ 6.5 million, $ 25.0 million, and $ 23.4 million of principal on the TEU amortizing notes in the years ended December 31, 2022, 2021, and 2020, respectively.

Subsequent to December 31, 2021, all of the remaining TEU prepaid stock purchase contracts were converted to shares of common stock and the final quarterly cash installment on the TEU Amortizing Notes was paid.

The final installment payment was made on January 15, 2022.

Additionally, in the first quarter of 2022, all of the remaining related TEU prepaid stock purchase contracts were converted to shares of common stock.

See Note 14, “Equity” for further information.

2024 Notes and 2026 Notes

On February 5, 2019, two tranches of senior notes with aggregate principal amounts of $ 600 million (the “2024 Notes”) and $ 400 million (the “2026 Notes”) were issued to finance a portion of the purchase price for the DJO acquisition.

The 2024 Notes were due on February 15, 2024 and had an interest rate of 6.0 %.

The 2026 Notes are due on February 15, 2026 and have an interest rate of 6.375 %.

The 2026 Notes are guaranteed by certain domestic subsidiaries of the Company.

COLFAX CORPORATION

The Company had senior notes with a remaining principal amount of $ 300 million, which were due on February 15, 2026 and had an interest rate of 6.375 % (the “2026 Notes”).

The 2026 Notes were redeemed on April 7, 2022 at a 103.188 % redemption premium after the completion of the Separation.

On April 24, 2021, the Company used the proceeds from its March 2021 equity offering to redeem all of its $ 600 million 6.0 % senior notes due February 14, 2024 (the “2024 Notes”) and $ 100 million of the outstanding principal of its 2026 Notes for

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

On April 24, 2021, the Company used the proceeds from its March 2021 equity offering to redeem all $ 600 million outstanding principal of its 2024 Notes and $ 100 million of the outstanding principal of its 2026 Notes for $ 724.4 million.

$ 724.4 million.

The 2024 Notes were redeemed at a redemption price of 103.000 % of their principal amount and the 2026 Notes were redeemed at a redemption price of 106.375 % of their principal amount, plus, in each case, accrued and unpaid interest through the date of redemption.

In the second quarter of 2021, a net loss on the early extinguishment of debt of $ 29.9 million was recorded and included $ 24.4 million of call premium on the retired debt.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Other Indebtedness

In addition to the d ebt agreements discussed above, the Company is party to various bilateral credit facilities with a borrowing capacity of $ 169.0 million.

In addition to the d ebt agreements discussed above, the Company is party to various overdraft facilities with a borrowing capacity of $ 30.0 million .

As of December 31, 2022, there were no outstanding borrowings under these facilities.

The Company is party to letter of credit facilities with an aggregate capacity of $ 277.3 million.

The Company is party to letter of credit facilities with an aggregate cap acity of $ 15.0 million.

Total letters of credit of $ 7.1 million were outstanding as of December 31, 2022.

Deferred Financing Fees

In total, the Company had deferred financing fe es of $ 12.3 million i ncluded in its Consolidated Balance Sheet as of December 31, 2021, which will be charged to Interest expense, net, primarily using the effective interest method, over the life of the applicable debt agreements.

Contractual Maturities

6 unchanged sentences

Total debt $ 259,279

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

On March 19, 2021, the Company completed the underwritten public offering of 16.1 million shares of Colfax Common stock at a price to the public of $ 46.00 per share, resulting in net proceeds of approximately $ 711.3 million, after deducting offering expenses and underwriters’ discount and commissions.

On July 28, 2021, the Company issued 6.5 million shares of Colfax Common stock to the former shareholders of Mathys for acquisition consideration of $ 285.7 million.

On March 19, 2021, the Company completed the underwritten public offering of 5.4 million shares of Colfax Common stock, as adjusted for the reverse stock split, resulting in net proceeds of approximately $ 711.3 million, after deducting offering expenses and underwriters’ discount and commissions.

On July 28, 2021, the Company issued 2.2 million shares of Colfax Common stock, as adjusted for the reverse stock split, to the former shareholders of Mathys for acquisition consideration of $ 285.7 million.

Share Repurchase Program

3 unchanged sentences

The timing, amount and method of shares repurchased is determined by management based on its evaluation of market conditions and other factors.

During the year ended December 31, 2018, the Company repurchased 6,449,425 shares of our Common stock in open market transactions for $ 200 million.

During the year ended December 31, 2018, the Company repurchased 2,149,808 shares, as adjusted for the reverse stock split, of our Common stock in open market transactions for $ 200 million.

Since 2018, there have been no repurchases made under this program.

1 unchanged sentence

There is no term associated with the remaining repurchase authorization.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Accumulated Other Comprehensive Loss

1 unchanged sentence

All amounts are net of tax and noncontrolling interest, if any.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Accumulated Other Comprehensive Loss Components

5 unchanged sentences

Foreign currency translation adjustment ( 1,849 ) 57,623 3,378 59,152

Divestiture-related AOCI write-off — 400,143 — 400,143

Gain on long-term intra-entity foreign currency transactions — 3,289 — 3,289

Gain on net investment hedges — — 6,215 6,215

Unrealized gain on cash flow hedges — — 156 156

Loss on net investment hedges — — ( 26,268 ) ( 26,268 )

Other comprehensive income (loss) before reclassifications ( 10,018 ) 60,912 ( 22,890 ) 28,004

2 unchanged sentences

Net Other comprehensive income (loss) ( 6,283 ) 60,912 ( 22,890 ) 31,739

Noncontrolling interest share repurchase — ( 19,960 ) — ( 19,960 )

Cumulative effect of accounting change ( 9,300 ) — ( 6,068 ) ( 15,368 )

Balance at December 31, 2020 ( 112,783 ) ( 360,977 ) 21,654 ( 452,106 )

Other comprehensive income (loss) before reclassifications:

Net actuarial loss ( 8,169 ) — — ( 8,169 )

Net actuarial gain 20,866 — — 20,866

Foreign currency translation adjustment 1,339 ( 146,409 ) ( 230 ) ( 145,300 )

Gain on long-term intra-entity foreign currency transactions — 32,261 — 32,261

Loss on net investment hedges — — ( 26,268 ) ( 26,268 )

Gain on net investment hedges — — 23,247 23,247

Other comprehensive income (loss) before reclassifications:

22,205 ( 114,148 ) 23,017 ( 68,926 )

Amounts reclassified from Accumulated other comprehensive loss (1)

5 unchanged sentences

Foreign currency translation adjustment 470 ( 37,953 ) — ( 37,483 )

Gain on long-term intra-entity foreign currency transactions — 32,261 — 32,261

Loss on long-term intra-entity foreign currency transactions — ( 21,779 ) — ( 21,779 )

Gain on net investment hedges — — 9,028 9,028

2 unchanged sentences

Amounts reclassified from Accumulated other comprehensive loss (1)

5,019 — — 5,019

Net Other comprehensive income (loss) 13,306 ( 59,732 ) 9,028 ( 37,398 )

Distribution of ESAB Corporation 84,460 469,220 ( 53,699 ) 499,981

Balance at December 31, 2022 $ 12,207 $ ( 65,637 ) $ — $ ( 53,430 )

1 unchanged sentence

See Note 16, “Defined Benefit Plans” for additional details.

COLFAX CORPORATION

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the years ended December 31, 2021, 2020 and 2019, Noncontrolling interest decreased by $ 1.3 million, $ 2.6 million, and $ 107.6 million, respectively, as a result of Other comprehensive income, primarily due to the Howden sale and foreign currency translation adjustment.

During the years ended December 31, 2022, 2021 and 2020, Noncontrolling interest decreased by $ 2.1 million, $ 1.3 million, and $ 2.6 million, respectively, as a result of Other comprehensive income, primarily due to foreign currency translation adjustment.

Share-Based Payments

On May 21, 2020, the shareholders of the Company approved the Colfax Corporation 2020 Omnibus Incentive Plan (the “2020 Plan”) which replaced the Colfax Corporation 2016 Omnibus Incentive Plan dated May 13, 2016 (the “2016 Plan”).

Upon the approval of the 2020 Plan, no additional ordinary shares were to be granted under the previously approved plans.

On June 7, 2022, the shareholders of the Company approved an amendment (the “Amendment”) to the Company’s 2020 Omnibus Incentive Plan (the “2020 Plan”), which was originally adopted by the shareholders of the Company on May 21, 2020.

The Amendment authorizes an additional 745,000 shares of common stock of the Company and did not make any other changes to the 2020 Plan.

Upon the approval of the 2020 Plan, no additional ordinary shares were to be granted under the Company’s previously approved plans, including the Company’s 2016 Omnibus Incentive Plan dated May 13, 2016.

All awards previously granted and outstanding under the prior plans remain subject to the terms of those prior plans.

The 2020 Plan provides the Compensation Committee of the Company’s Board of Directors (“Compensation Committee”) discretion in creating employee equity incentives.

The 2020 Plan provides the Compensation and Human Capital Management Committee of the Company’s Board of Directors (“Compensation Committee”) discretion in creating employee equity incentives.

Awards under the 2020 Plan may be made in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, performance-based stock, performance-based stock units, dividend equivalents, and other stock-based awards.

6 unchanged sentences

Stock-based compensation expense (1)

$ 38,955 $ 35,350 $ 28,911

Deferred tax benefit 1,236 2,658 1,804

(1) Stock-based compensation expense includes $ 2.1 million, $ 7.7 million and $ 6.6 million of expense included in Income from discontinued operations on the Company’s Consolidated Statements of Operations for the years ended December 31, 2022, 2021 and 2020, respectively.

As of December 31, 2022, the Company had $ 29.7 million of unrecognized compensation expense related to stock-based awards that will be recognized over a weighted-average period of 1.1 years.

5 unchanged sentences

The following table shows the weighted-average assumptions used to calculate the fair value of stock option awards using the Black-Scholes option pricing model, as well as the weighted-average fair value of options granted:

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31,

6 unchanged sentences

Weighted-average fair value of options granted (1)

During the years ended December 31, 2021, 2020 and 2019, expected volatility was estimated based on the historical volatility of the Company’s stock price.

The Company considers historical data to estimate employee termination within the valuation model.

Separate groups of employees that have similar historical exercise behavior are considered separately for

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

valuation purposes.

$ 27.48 $ 27.64 $ 20.22

(1) The weighted-average fair value of options granted in 2021 and 2020 have been adjusted by a factor of 1.7 due to the Separation and reverse stock split.

As a result of the Separation, beginning in April 2022, expected volatility is based on the weighted average historical stock price volatility of a group of peer companies for the expected term of the option.

Prior to April 2022, expected volatility was estimated based on the historical volatility of the Company’s stock price.

The Company considers historical data to estimate forfeitures within the valuation model.

Groups of employees that have similar historical exercise behavior are considered together for valuation purposes.

The Company has elected to estimate the expected life of an award based upon the Securities and Exchange Commission-approved “simplified method” noted under the provisions of Staff Accounting Bulletin No.

1 unchanged sentence

Stock option activity is as follows:

of Options Weighted-

of Options (1)

Price Weighted-

6 unchanged sentences

Outstanding at December 31, 2020 2,705,070 50.61

Granted 331,375 65.08

Exercised ( 712,810 ) 48.91

Forfeited and expired ( 170,529 ) 97.46

Outstanding at December 31, 2021 2,153,106 49.70

Granted 154,552 70.23

Exercised ( 127,261 ) 45.69

Forfeited and expired ( 407,069 ) 72.53

Adjustment due to ESAB Separation (3)

( 425,651 ) 57.64

Outstanding at December 31, 2022 1,347,677 59.96 3.68 $ 3,721

Vested or expected to vest at December 31, 2022 1,341,299 59.90 3.67 3,721

Exercisable at December 31, 2022 1,009,553 56.07 3.12 3,628

(1) The outstanding options as of December 31, 2021 and the option activity prior to December 31, 2021 have been adjusted by a factor of 1.7 due to the Separation and reverse stock split.

(2) The aggregate intrinsic value is based upon the difference between the Company’s closing stock price at the date of the Consolidated Balance Sheet and the exercise price of the stock option for in-the-money stock options.

The intrinsic value of outstanding stock options fluctuates based upon the trading value of the Company’s Common stock.

(3) Reflects the cancellation of outstanding options held by ESAB employees as of April 4, 2022, which were replaced with ESAB options issued by ESAB Corp.

as part of the Separation.

The total intrinsic value of options exercised during the years ended December 31, 2022, 2021 and 2020 was $ 1.5 million , $ 21.4 million and $ 1.1 million, respectively.

The fair value of options vested during the years ended December 31, 2022, 2021 and 2020 was $ 7.4 million , $ 9.0 million and $ 11.9 million, respectively.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Restricted Stock Units

2 unchanged sentences

The awards also have a service requirement that equals the respective performance periods.

During the year ended December 31, 2018, PRSUs were awarded under the 2016 Plan based upon two discrete measures:

a profit performance metric and relative TSR.

The profit performance metric, which accounts for 50 % of the PRSU award upon issuance, is measured upon the completion of a three-year performance period ending December 31, 2020.

The remaining 50 % of the PRSU award is tied exclusively to relative TSR performance, which will be measured against the three-year TSR of a custom index of companies.

TSR relative to peers is considered a market condition under applicable authoritative guidance, while the profit performance metric is considered a performance condition.

In the first quarter of 2021, it was determined that 200 % of the profit performance metric was achieved and 78 % of the relative TSR metric was achieved in accordance with the applicable criteria established by the Compensation Committee.

PRSUs with TSR conditions are valued at grant date using a binomial-lattice model (i.e., Monte Carlo simulation model), while PRSUs with a company-specific profit performance metric are valued at the market value of a share of Common stock on the date of grant taking into consideration the probability of achieving the specified performance goal.

The Company estimates the ultimate payout of PRSUs with a profit performance metric and adjusts the cumulative expense based on its estimate and the percent of the requisite service period that has elapsed.

The final achievement of all outstanding PRSU awards was determined as of April 4, 2022 based on the current performance as of the time of the Separation.

It was determined that 100 % of the TSR metric was achieved for the PRSUs granted during the years ended December 31, 2022 and 2021, while 70 % of the TSR metric was achieved for the PRSUs granted during the year ended December 31, 2020.

The achievement factors were determined in accordance with the applicable criteria established by the Compensation Committee.

While the achievement factor of the outstanding awards has been determined, they remain subject to the awards’ service period requirements and will therefore continue to vest over the original term of the award.

PRSUs with TSR conditions are valued at grant date using a binomial-lattice model (i.e., Monte Carlo simulation model).

PRSUs with TSR conditions are recognized on a straight-line basis over the performance periods regardless of the performance condition achievement because the probability is factored into the valuation of the award.

2 unchanged sentences

With limited exceptions, the employee must remain in service until the vesting date.

The Compensation Committee determines the

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

terms and conditions of each award, incl uding the restriction period and other criteria applicable to the awards.

The Compensation Committee determines the terms and conditions of each award, incl uding the restriction period and other criteria applicable to the awards.

Directors may also elect to defer their annual board fees into RSUs with immediate vesting.

1 unchanged sentence

The activity in the Company’s PRSUs and RSUs is as follows:

of Units Weighted-

Fair Value Number

of Units Weighted-

Nonvested at January 1, 2020 436,103 $ 52.48 383,836 $ 45.54

3 unchanged sentences

Nonvested at December 31, 2020 430,236 59.70 489,654 55.06

The weighted-average grant-date fair value of PRSUs granted during the years ended December 31, 2020 and 2019 was $ 50.91 and $ 24.77 , respectively.

The weighted-average grant-date fair value of RSUs granted during the years ended December 31, 2020 and 2019 was $ 34.80 and $ 27.58 , respectively.

Granted 146,322 77.84 464,279 78.84

Vested ( 113,991 ) 52.75 ( 248,405 ) 51.71

Forfeited and expired ( 96,492 ) 48.30 ( 60,311 ) 63.95

Nonvested at December 31, 2021 366,075 72.13 645,217 69.44

Granted 192,921 47.89 303,752 67.58

Vested ( 230,310 ) 49.69 ( 243,485 ) 64.11

Forfeited and expired ( 35,516 ) 46.07 ( 70,914 ) 69.22

Adjustment due to ESAB Separation (2)

( 32,373 ) 46.07 ( 131,291 ) 71.52

Nonvested at December 31, 2022 260,797 77.34 503,279 71.33

(1) The outstanding awards as of December 31, 2021 and the award activity prior to December 31, 2021, have been adjusted by a factor of 1.7 due to the Separation and reverse stock split.

(2) Reflects the cancellation of unvested awards held by ESAB employees as of April 4, 2022, which were replaced with ESAB awards issued by ESAB as part of the Separation.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The fair value of shares vested during the years ended December 31, 2022, 2021 and 2020 was $ 32.1 million , $ 18.3 million and $ 9.7 million, respectively.

Tangible equity unit (“TEU”) offering

On January 11, 2019, we issued $ 460 million in TEUs with a 5.75 % interest rate, comprised of 4.6 million units at $ 100 per unit.

On January 11, 2019, the Company issued $ 460 million in TEUs with a 5.75 % interest rate, comprised of 4.6 million units at $ 100 per unit.

Total cash of $ 447.7 million was received upon closing.

The proceeds from the issuance of the TEUs were allocated initially to equity and debt based on the relative fair value of the respective components of each TEU as follows:

TEU prepaid stock purchase contracts TEU amortizing notes Total

(In millions, except per unit amounts)

Fair value per unit $ 84.39 $ 15.61 $ 100.00

Gross proceeds $ 388.2 $ 71.8 $ 460.0

Issuance costs 10.4 1.9 12.3

Net Proceeds $ 377.8 $ 69.9 $ 447.7

The $ 377.8 million fair value of the prepaid stock purchase contracts was recorded in Additional paid-in capital and the fair value of the $ 69.9 million of TEU amortizing notes due January 2022 was initially recorded in debt in the Consolidated Balance Sheets.

The Company deferred certain debt issuance costs associated with the debt component of the TEUs.

These amounts offset the debt liability balance in the Consolidated Balance Sheets and are amortized over its term.

Refer to Note 13, “Debt” for additional information on the TEU amortizing notes.

TEU prepaid stock purchase contracts

During the year ended December 31, 2021, 3.3 million TEU prepaid stock purchase contracts were settled at the holder’s option into approximately 13.3 million shares of Colfax common stock at a conversion rate of 4.0 shares per contact.

For the remaining 1.3 million TEU purchase contracts as of December 31, 2021, based on the arithmetic average of the volume weighted price for the 20 consecutive trading days from December 17, 2021 through January 14, 2022 which was greater than the minimum settlement rate, the Company will deliver 4.0 shares of common stock per contract.

Subsequent to December 31, 2021, the Company settled the remaining purchase contracts per the terms of the agreement and issued approximately 5.1 million shares of Colfax common stock in January 2022.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Since the 4.6 million TEU prepaid stock purchase contracts are mandatorily convertible into shares of Colfax common stock the 18.4 million shares are included in our net income per share calculations.

The proceeds from the issuance of the TEUs were allocated 84.4 % to equity (the “TEU prepaid stock purchase contracts”) and 15.6 % to debt (the “TEU amortizing notes”) based on the relative fair value of the respective components of each TEU.

See Note 13, “Debt” for additional information on the TEU amortizing notes.

The TEU prepaid stock purchase contracts were mandatorily converted into shares of Company common stock on January 15, 2022, unless previously settled at the holder’s option.

All the TEU prepaid stock purchase contracts converted at the minimum settlement rate.

Approximately 1.3 million and 3.3 million TEU prepaid stock purchase contracts were settled into approximately 1.7 million and 4.4 million shares of Company common stock, as adjusted for the reverse stock split, during the years ended December 31, 2022 and 2021, respectively.

Since the 4.6 million TEU prepaid stock purchase contracts were mandatorily converted into shares of Company common stock at the minimum settlement rate or greater, 6.1 million shares, as adjusted for the reverse stock split, are included in basic net income per share calculations for all periods presented.

See Note 7, “Net Income Per Share from Continuing Operations” for additional information.

Repurchase of noncontrolling interest shares

During 2019, the Company repurchased all of the noncontrolling interest shares of its South Africa consolidated subsidiary from existing shareholders under a general offer.

As a part of the Air and Gas Handling business, this subsidiary was subsequently sold on September 30, 2019, and its results of operations are included in Loss from discontinued operations, net of taxes for the year ended December 31, 2019.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Accrued Liabilities

3 unchanged sentences

Accrued taxes 13,676 12,970

Accrued asbestos-related liability 30,572 41,626

Accrued freight 3,955 5,299

Contingent consideration - current portion 8,812 1,816

Warranty liability- current portion 2,804 2,503

4 unchanged sentences

Accrued interest 2,921 11,066

Accrued rebates 13,715 12,584

Accrued professional fees 15,670 13,711

Accrued royalties 5,777 5,045

Other 37,689 38,436

$ 210,292 $ 225,391

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Accrued Restructuring Liability

1 unchanged sentence

A summary of the activity in the Company’s restructuring liability included in Accrued liabilities and Other liabilities in the Consolidated Balance Sheets is as follows:

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2022

Balance at Beginning of Period Provisions Payments Foreign Currency Translation Balance at End of Period (3)

Balance at Beginning of Period Provisions Payments Balance at End of Period (4)

(In thousands)

Restructuring and other related charges:

Fabrication Technology:

Termination benefits (1)

$ 5,336 $ 9,633 $ ( 7,096 ) $ ( 55 ) $ 7,818

Facility closure costs and other (2)

591 8,068 ( 8,351 ) ( 17 ) 291

Subtotal 5,927 17,701 ( 15,447 ) ( 72 ) 8,109

Non-cash charges (2)

Fabrication Technology total provisions 18,954

Medical Technology:

Restructuring and other charges:

Termination benefits (1)

2 unchanged sentences

358 12,864 ( 13,104 ) 118

Subtotal 2,181 8,663 ( 8,007 ) ( 9 ) 2,828

Non-cash charges (2)

Medical Technology total provisions 13,914

Total $ 2,828 16,808 $ ( 18,545 ) $ 1,091

Non-cash charges (3)

Total Colfax provisions $ 32,868

Total Provisions (5)

(1) Includes severance and other termination benefits, including outplacement services.

(2) Includes the cost of relocating associates, relocating equipment, lease termination expense, and other costs in connection with the closure and optimization of facilities and product lines.

Medical Technology segment charges include $ 5.2 million classified as Cost of sales on the Company’s Consolidated Statements of Operations for the year ended December 31, 2021.

(3) The Company’s charges include $ 1.7 million classified as Cost of sales on the Company’s Consolidated Statements of Operations for the year ended December 31, 2022.

The remaining $ 17.2 million of restructuring expense is recorded as Restructuring and other charges on the Company’s Consolidated statements of Operations for the year ended December 31, 2022.

(4) As of December 31, 2022, all of the restructuring liability was included in Accrued liabilities.

In the Accrued liabilities table above, $ 0.4 million and $ 0.3 million of the Company’s restructuring liability is included in Accrued compensation and related benefits and Other, respectively.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(5) $ 9.6 million and $ 9.4 million of the Company’s total provisions is related to the Prevention & Recovery and Reconstructive segments, respectively.

Year Ended December 31, 2021

1 unchanged sentence

(In thousands)

Restructuring and other related charges:

Fabrication Technology:

Termination benefits (1)

$ 1,638 $ 11,381 $ ( 7,698 ) $ 15 $ 5,336

Facility closure costs (2)

1,284 8,358 ( 9,060 ) 9 591

Subtotal 2,922 19,739 ( 16,758 ) 24 5,927

Non-cash charges (2)

Fabrication Technology total provisions 21,633

Medical Technology:

Restructuring and other charges:

Termination benefits (1)

2 unchanged sentences

297 4,627 ( 4,566 ) — 358

Subtotal 4,176 20,409 ( 22,490 ) 86 2,181

Non-cash charges (2)

Medical Technology total provisions 23,394

Total $ 2,181 8,663 $ ( 8,007 ) $ ( 9 ) $ 2,828

Non-cash charges (3)

Total Colfax provisions $ 45,027

Total Provisions (5)

(1) Includes severance and other termination benefits, including outplacement services.

(2) Includes the cost of relocating associates, relocating equipment and lease termination expense in connection with the closure of facilities.

Medical Technology segment charges include costs related to product and distribution channel transformations, facilities optimization, and integration charges, as well as $ 6.6 million classified as Cost of sales on the Company’s Consolidated Statements of Operations for the year ended December 31, 2020.

(3) As of December 31, 2020, $ 7.9 million and $ 0.2 million of the Company’s restructuring liability was included in Accrued liabilities and Other liabilities, respectively.

(2) Includes the cost of relocating associates, relocating equipment and lease termination expense in connection with the closure and optimization of facilities and product lines.

(3) The Company’s charges include $ 5.2 million classified as Cost of sales on the Company’s Consolidated Statements of Operations for the year ended December 31, 2021.The remaining $ 8.7 million of restructuring expense is recorded as Restructuring and other charges on the Company’s Consolidated statements of Operations for the year ended December 31, 2021.

(4) As of December 31, 2021, all of the restructuring liability was included in Accrued liabilities.

In the Accrued liabilities table above, $ 0.4 million and $ 0.3 million of the Company’s restructuring liability is included in Accrued compensation and related benefits and Other, respectively.

(5) $ 11.5 million and $ 2.4 million of the Company’s total provisions is related to the Prevention & Recovery and Reconstructive segments, respectively.

Defined Benefit Plans

The Company sponsors various defined benefit plans, defined contribution plans and other post-retirement benefits plans, including health and life insurance, for certain eligible employees or former employees.

The Company sponsors various defined benefit plans and defined contribution plans for certain eligible employees or former employees.

Since the Separation, all of the Company’s defined benefit plans are based outside of the U.S and the Company does not sponsor any other post-retirement benefit plans.

The Company uses December 31 st as the measurement date for all of its employee benefit plans.

COLFAX CORPORATION

As part of the Separation, all plans sponsored by ESAB and certain U.S.

defined benefit and other post-retirement plans, formerly sponsored by the Company, were transferred to ESAB as of March 21, 2022.

As a result of the transfer, the related net plan obligations of approximately $ 70 million are reflected as discontinued operations within the Company’s Consolidated Balance Sheet as of December 31, 2021.

The impact of transferring the plans to ESAB is shown as Divestitures in the tables

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following tables include all plans historically sponsored by the Company prior to the transfer to ESAB.

See Note 4, “Discontinued Operations” for further information.

The following table summarizes the total changes in the Company’s pension and accrued post-retirement benefits and plan assets and includes a statement of the plans’ funded status.

The amounts presented as of December 31, 2021 and the changes in benefit obligation and plan assets in 2022 include three months of activity of the ESAB plans prior to the Separation.

Pension Benefits Other Post-Retirement Benefits

8 unchanged sentences

Interest cost 1,821 4,642 61 189

Plan amendment 911 95 — —

Actuarial loss (gain) (2)

Actuarial gain (2)

( 21,586 ) ( 11,171 ) — ( 650 )

1 unchanged sentence

Benefits paid ( 5,724 ) ( 22,073 ) ( 231 ) ( 812 )

Settlements ( 847 ) ( 418 ) — —

Divestitures (3)

( 337,045 ) — ( 11,905 ) —

Other 2,683 5,912 — —

8 unchanged sentences

Benefits paid ( 5,724 ) ( 22,073 ) ( 231 ) ( 812 )

Settlements (3)

Divestitures (3)

( 282,534 ) — — —

Settlements (4)

Other 2,510 5,393 — —

3 unchanged sentences

Non-current assets (5)

$ — $ 7,733 $ — $ —

Current liabilities (6)

( 174 ) ( 3,564 ) — ( 923 )

Non-current liabilities (6)

( 17,205 ) ( 92,416 ) — ( 11,155 )

Total $ ( 17,379 ) $ ( 88,247 ) $ — $ ( 12,078 )

(1) Acquisitions in the year ended December 31, 2021 relate to our acquisition of Mathys.

(1) Acquisitions for 2021 relate to our acquisition of Mathys.

See Note 5, “Acquisitions”, for further information.

(2) The reported actuarial gain in the year ended December 31, 2021 is primarily due to the increase in discount rates in most markets.

The reported actuarial loss in the year ended December 31, 2020 is primarily due to the decrease in discount rates in most markets.

(3) Settlements includes $ 11.2 million classified as Pension settlement gain on the Company’s Consolidated Statements of Operations for the year ended December 31, 2021, when independent trustees of a company pension plan agreed to merge that plan with another company pension plan and contribute its surplus assets.

For pension plans with accumulated benefit obligations in excess of plan assets, the accumulated benefit obligation and fair value of plan assets were $ 171.4 million and $ 82.1 million, respectively, as of December 31, 2021 and $ 367.4 million and $ 259.1 million, respectively, as of December 31, 2020.

For pension plans with projected benefit obligations in excess of plan assets, the projected benefit obligation and fair value of plan assets were $ 185.0 million and $ 87.5 million, respectively, as of December 31, 2021 and $ 376.0 million and $ 263.9 million, respectively, as of December 31, 2020.

COLFAX CORPORATION

(2) The actuarial gains for 2022 and 2021 are primarily due to the increases in discount rates in most markets.

(3) Divestitures are related to the Separation.

(4) Settlements includes $ 11.2 million classified as Pension settlement gain included in discontinued operations for 2021, when independent trustees of a company pension plan agreed to merge that plan with another company pension plan and contribute its surplus assets.

(5) As of December 31, 2021, all of the non-current plan assets are associated with discontinued operations.

(6) As of December 31, 2021, current pension liabilities and non-current pension liabilities of $ 3.4 million and $ 62.2 million, respectively, are associated with discontinued operations.

Additionally, all of the other post-retirement benefits liabilities are associated with discontinued operations.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The projected benefit obligation increased by $ 77.3 million in the year ended December 31, 2021 compared to an increase of $ 18.1 million in the year ended December 31, 2020.

As of December 31, 2022, all remaining Enovis plans had projected benefit obligations in excess of the fair value of plan assets.

As of December 31, 2021, for pension plans with projected benefit obligations in excess of plan assets, the projected benefit obligation and fair value of plan assets were $ 185.0 million and $ 87.5 million, respectively.

The projected benefit obligation decreased by $ 360.0 million in the year ended December 31, 2022 compared to an increase of $ 75.8 million in the year ended December 31, 2021.

In the year ended December 31, 2022, the single largest driver was a decrease of $ 337.0 million due to the divestiture of ESAB.

In addition, there was an actuarial gain of $ 21.6 million.

In the year ended December 31, 2021, the single largest driver was an increase of $ 101.3 million from the Mathys acquisition.

1 unchanged sentence

The following table summarizes the changes in the Company’s foreign pension benefit obligation, which is determined based upon an employee’s expected date of separation, and plan assets, included in the table above, and includes a statement of the plans’ funded status.

The amounts presented as of December 31, 2021 and the changes in benefit obligation and plan assets in 2022 include three months of activity of the ESAB plans prior to the Separation.

Foreign Pension Benefits

6 unchanged sentences

Interest cost 897 1,741

Plan amendments 911 95

Actuarial loss (gain) (2)

2 unchanged sentences

Benefits paid ( 1,854 ) ( 7,122 )

Settlements ( 847 ) ( 418 )

Divestitures (3)

( 137,663 ) —

Other 2,683 5,912

8 unchanged sentences

Benefits paid ( 1,854 ) ( 7,122 )

Divestitures (3)

Settlements (4)

11,272 ( 418 )

Other 2,510 5,393

3 unchanged sentences

See Note 5, “Acquisitions”, for further information.

(2) The reported actuarial gain in the year ended December 31, 2021 is primarily due to the increase in discount rates in most markets.

The reported actuarial loss in the year ended December 31, 2020 is primarily due to the decrease in discount rates in most markets.

(3) Settlements includes $ 11.2 million classified as Pension settlement gain on the Company’s Consolidated Statements of Operations for the year ended December 31, 2021.

Expected contributions to the Company’s pension and other post-employment benefit plans for the year ending December 31, 2022, related to plans as of December 31, 2021, are $ 8.6 million.

The following benefit payments are expected to be paid during each respective fiscal year:

COLFAX CORPORATION

(2) The actuarial gains for 2022 and 2021 are primarily due to the increases in discount rates in all markets.

(3) Divestitures are related to the Separation.

(4) Settlements includes $ 11.2 million classified as Pension settlement gain included in discontinued operations for the year ended December 31, 2021.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Pension Benefits Other Post-Retirement Benefits

All Plans Foreign Plans

Expected contributions to the Company’s pension plans for the year ending December 31, 2023 are $ 3.3 million.

The following benefit payments are expected to be paid during each respective fiscal year:

Pension Benefits

(In thousands)

2028 - 2031 28,098

2023 27,505 12,359 858

2024 26,897 12,159 816

2025 27,139 21,817 810

2026 26,944 13,068 805

2027 - 2031 123,379 61,457 3,644

The Company’s primary investment objective for its pension plan assets is to provide a source of retirement income for the plans’ participants and beneficiaries.

3 unchanged sentences

The asset allocation is monitored and rebalanced as required, as frequently as on a quarterly basis in some instances.

The plan assets are planned to have a higher allocation to fixed income to account for the improvement in funded status during 2021.

The following are the actual and target allocation percentages for the Company’s pension plan assets:

2 unchanged sentences

Equity securities:

45 % 44 % 25 %- 45 %

International 15 %

Fixed income 38 %

Other — % — % 0 %- 20 %

Cash and cash equivalents 1 %

4 unchanged sentences

Other 36 % 43 % 25 %- 45 %

A summary of the Company’s pension plan assets for each fair value hierarchy level for the periods presented follows (see Note 17, “Financial Instruments and Fair Value Measurements”, for further description of the levels within the fair value hierarchy):

COLFAX CORPORATION

(1) As of December 31, 2022, all U.S.

plans have been divested as a result of the Separation.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

December 31, 2022

Measured at Net Asset Value (1)

Measured at Net Asset Value Level

(In thousands)

Cash and cash equivalents (2)

$ — $ 1,699 $ — $ — $ 1,699

Equity securities:

large cap 52,810 — — — 52,810

small/mid cap 21,983 15,501 — — 37,484

International 31,094 — — — 31,094

Fixed income mutual funds:

government and corporate 77,084 — — — 77,084

— 1,088 — — 1,088

Foreign Plans:

4 unchanged sentences

$ — $ 49,548 $ 28,148 $ — $ 77,696

(1) Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient (the “NAV”) have not been classified in the fair value hierarchy.

These investments, consisting of common/collective trusts, are valued using the NAV provided by the Trustee.

The NAV is based on the underlying investments held by the fund, that are traded in an active market, less its liabilities.

These investments are able to be redeemed in the near-term.

(2) The weighted-average interest crediting rates received in Cash and cash equivalents of U.S plans are immaterial relative to total plan assets.

(1) Represents diversified portfolio funds, reinsurance contracts and money market funds.

17 unchanged sentences

$ 182,971 $ 113,272 $ 70,577 $ — $ 366,820

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(1) Certain investments that are measured at fair value using the NAV have not been classified in the fair value hierarchy.

These investments, consisting primarily of common/collective trusts, are valued using the NAV provided by the Trustee.

3 unchanged sentences

(3) Represents diversified portfolio funds, reinsurance contracts and money market funds.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table sets forth the components of Net periodic benefit (income) cost and Other comprehensive (gain) loss of the Company’s defined benefit pension plans and other post-retirement employee benefit plans:

8 unchanged sentences

Settlement (gain) loss — ( 11,157 ) 99 — — —

Divestitures gain — — ( 4,354 ) — — —

Other ( 20 ) 2 143 — — —

9 unchanged sentences

Total recognized in Other comprehensive (gain) loss $ ( 15,694 ) $ ( 33,400 ) $ 5,316 $ 36 $ ( 542 ) $ 1,374

Net periodic benefit income of $ 11.2 million for the year ended December 31, 2021 is recorded in Pension settlement (gain) loss on the Company’s Consolidated Statements of Operations.

Net periodic benefit cost of $ 44.4 million for the year ended December 31, 2019 is included in Loss from discontinued operations, net of taxes.

Net periodic benefit cost included in loss from discontinued operations for the year ended December 31, 2019 includes $ 43.8 million in settlement loss related to the Air and Gas Handling business.

Each component of Net periodic benefit (income) cost from continuing operations, with the exception of Pension settlement (gain) loss, is included in Selling, general and administrative expense.

The following table sets forth the components of Net periodic benefit (income) cost and Other comprehensive (gain) loss of the foreign defined benefit pension plans, included in the table above:

COLFAX CORPORATION

Net periodic benefit (income) cost of $ 0.3 million, $( 9.9 ) million, and $ 2.4 million, for the years ended December 31, 2022, 2021 and 2020, respectively are included in Income from discontinued operations.

Each component of Net periodic benefit (income) cost from continuing operations is included in Selling, general and administrative expense.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table sets forth the components of Net periodic benefit (income) cost and Other comprehensive (gain) loss of the foreign defined benefit pension plans, included in the table above:

Foreign Pension Benefits

7 unchanged sentences

Settlement (gain) loss — ( 11,157 ) 99

Divestitures gain — — ( 4,354 )

Other ( 20 ) 2 143

17 unchanged sentences

Total $ ( 16,132 ) $ 73,024 $ ( 2,573 )

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The key economic assumptions used in the measurement of the Company’s pension and other post-retirement benefit obligations are as follows:

6 unchanged sentences

Weighted-average rate of increase in compensation levels for active foreign plans 1.5 % 0.9 % — % — %

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The key economic assumptions used in the computation of Net periodic benefit (income) cost are as follows:

10 unchanged sentences

In determining discount rates, the Company utilizes the single discount rate equivalent to discounting the expected future cash flows from each plan using the yields at each duration from a published yield curve as of the measurement date.

For measurement purposes, a weighted-average annual rate of increase in the per capita cost of covered health care benefits of 7.5 % was assumed.

The rate was assumed to decrease gradually to 4.5 % by 2034 and remain at that level thereafter for benefits covered under the plans.

The expected long-term rate of return on plan assets was based on the Company’s investment policy target allocation of the asset portfolio between various asset classes and the expected real returns of each asset class over various periods of time that are consistent with the long-term nature of the underlying obligations of these plans.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company maintains defined contribution plans covering certain union and non-union employees.

The Company’s expense for the years ended December 31, 2021, 2020 and 2019 was $ 8.5 million, $ 10.2 million and $ 6.9 million, respectively.

The Company maintains defined contribution plans for its employees.

The Company’s expense in continuing operations for the years ended December 31, 2022, 2021 and 2020 was $ 6.6 million, $ 5.4 million and $ 4.8 million, respectively.

Financial Instruments and Fair Value Measurements

7 unchanged sentences

The carrying values of financial instruments, including Trade receivables, other receivables and Accounts payable, approximate their fair values due to their short-term maturities.

The estimated fair value of the Company’s debt of $ 2.1 billion $ 2.3 billion as of December 31, 2021 and 2020, respectively, was based on current interest rates for similar types of borrowings and is in Level Two of the fair value hierarchy.

The estimated fair value of the Company’s debt of $ 0.3 billion and $ 2.1 billion as of December 31, 2022 and 2021, respectively, was based on current interest rates for similar types of borrowings and is in Level Two of the fair value hierarchy.

The estimated fair values may not represent actual values of the financial instruments that could be realized as of the balance sheet date or that will be realized in the future.

As of December 31, 2022, the Company held $ 22.8 million in Level Three liabilities arising from contingent consideration related to acquisitions.

The fair value of the contingent consideration liabilities is determined using unobservable inputs and the inputs vary based on the nature of the purchase agreements.

These inputs can include the estimated amount and timing of projected cash flows, the risk-adjusted discount rate used to present value the projected cash flows, and the probability of the

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

acquired company attaining certain targets stated within the purchase agreements.

A change in these unobservable inputs to a different amount might result in a significantly higher or lower fair value measurement at the reporting date due to the nature of uncertainty inherent to the estimates.

During the year ended December 31, 2022, the company recorded contingent consideration of $ 20.1 million in conjunction with current acquisitions as well as an adjustment to reduce contingent consideration by $ 3.3 million from a prior acquisition, which was reflected in Selling, general and administrative expense in the Consolidated Statements of Operations.

The gross range of outcomes for contingent consideration arrangements that have a fixed limit is zero to $ 11.7 million.

There are two contingent consideration arrangements that have no limits and are based on a percentage of sales in excess of a benchmark over a one-year period and five-year period, respectively.

There were no other transfers in or out of Level One, Two or Three during the years ended December 31, 2022 and 2021.

A summary of the Company’s assets and liabilities that are measured at fair value on a recurring basis for each fair value hierarchy level for the periods presented is as follows:

1 unchanged sentence

(In thousands)

Cash equivalents $ 8,133 $ — $ — $ 8,133

Foreign currency contracts - not designated as hedges — 2,607 — 2,607

Deferred compensation plans $ — $ 10,324 $ — $ 10,324

2 unchanged sentences

Deferred compensation plans — 10,324 — 10,324

Contingent consideration — — 22,808 22,808

$ — $ 10,359 $ 22,808 $ 33,167

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

December 31, 2021

(In thousands)

Cash equivalents $ 7,420 $ — $ — $ 7,420

Foreign currency contracts - not designated as hedges $ — $ 5 $ — $ 5

3 unchanged sentences

Deferred compensation plans — 11,213 — 11,213

Contingent consideration — — 5,000 5,000

$ — $ 11,473 $ 5,000 $ 16,473

There were no transfers in or out of Level One, Two or Three during the years ended December 31, 2021 and 2020.

Cash Equivalents

The Company’s cash equivalents consist of investments in interest-bearing deposit accounts and money market mutual funds which are valued based on quoted market prices.

The fair value of these investments approximate cost due to their short-term maturities and the high credit quality of the issuers of the underlying securities.

Deferred Compensation Plans

The Company maintains deferred compensation plans for the benefit of certain employees and non-executive officers.

As of December 31, 2022 and 2021, the fair values of these plans were $ 10.3 million and $ 11.2 million, respectively.

These plans are deemed to be Level Two within fair value hierarchy.

The Company periodically enters into foreign currency derivative contracts.

As the Company has manufacturing sites throughout the world and sells its products globally, the Company is exposed to movements in the exchange rates of various currencies.

As the Company has manufacturing sites internationally in Europe, Africa, and Asia and sells its products globally, the Company is exposed to movements in the exchange rates of various currencies.

As a result, the Company enters into foreign currency swaps and forward contracts to mitigate this exchange rate risk.

Additionally, to mitigate a portion of the foreign exchange risk associated with the translation of the net assets of foreign subsidiaries, the Company has senior unsecured notes denominated in Euro which have been designated as net investment hedges.

See Note 13, “Debt”, for details.

As the Company’s borrowings under the Credit Facility include variable interest rates, the Company may periodically enter into interest rate swap or collar agreements to mitigate interest rate risk.

As the Company’s borrowings under the Credit Facility include variable interest rates, the

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Company may periodically enter into interest rate swap or collar agreements to mitigate interest rate risk.

Commodity derivative contracts can be used to manage costs of raw materials used in the Company’s production processes.

4 unchanged sentences

As of December 31, 2022 and 2021, the Company had foreign currency contracts related to purchases and sales with notional values of $ 0.8 million and $ 7.6 million, respectively.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company recognized the following in its Consolidated Financial Statements related to its derivative instruments:

Year Ended December 31,

2022 2021 2020

8 unchanged sentences

(1) The unrealized gain (loss) on net investment hedges is attributable to the change in valuation of Euro denominated debt.

In 2022, the Euro denominated debt was extinguished upon the Separation.

Concentration of Credit Risk

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Concentrations of credit risk are considered to exist when there are amounts collectible from multiple counterparties with similar characteristics, which could cause their ability to meet contractual obligations to be similarly impacted by economic or other conditions.

The Company performs credit evaluations of its customers prior to delivery or commencement of servic es and normally does not require collateral.

The Company performs credit evaluations of its customers prior to delivery or commencement of services and normally does not require collateral.

Letters of credit are occasionally required when the Company deems necessary.

There are no customers which represent more than 10% of the Company’s Accounts receivable, net as of December 31, 2021 and 2020.

There are no customers that represent more than 10% of the Company’s Accounts receivable, net as of December 31, 2022, 2021, and 2020.

Commitments and Contingencies

Asbestos and Other Product Liability Contingencies

Certain subsidiaries are each one of many defendants in a large number of lawsuits that claim personal injury as a result of exposure to asbestos from products manufactured or used with components that are alleged to have contained asbestos.

Such components were acquired from third-party suppliers, and were not manufactured by any of the Company’s subsidiaries nor were the subsidiaries producers or direct suppliers of asbestos.

The manufactured products that are alleged to have contained or used asbestos generally were provided to meet the specifications of the subsidiaries’ customers, including the U.S.

The subsidiaries settle asbestos claims for amounts the Company considers reasonable given the facts and circumstances of each claim.

The annual average settlement payment per asbestos claimant has fluctuated during the past several years.

The Company expects such fluctuations to continue in the future based upon, among other things, the number and type of claims settled in a particular period and the jurisdictions in which such claims arise.

To date, the majority of settled claims have been dismissed for no payment.

Pursuant to the purchase agreement from the Fluid Handling business divestiture, the Company retained its asbestos-related contingencies and insurance coverages.

However, as the Company does not retain an interest in the ongoing operations of the business subject to the contingencies, asbestos-related activity is classified as part of Loss from discontinued operations, net of taxes in its Consolidated Statements of Operations.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Claims activity since December 31 related to asbestos claims is as follows:

2021 2020 2019

(Number of claims)

Claims unresolved, beginning of period 14,809 16,299 16,417

Claims filed (1)

4,393 4,014 4,486

Claims resolved (2)

( 4,643 ) ( 5,504 ) ( 4,604 )

Claims unresolved, end of period 14,559 14,809 16,299

Average cost of resolved claims (3)

$ 8,421 $ 12,055 $ 9,455

(1) Claims filed include all asbestos claims for which notification has been received or a file has been opened.

(2) Claims resolved include all asbestos claims that have been settled, dismissed or that are in the process of being settled or dismissed based upon agreements or understandings in place with counsel for the claimants.

(3) Excludes claims settled in Mississippi for which the majority of claims have historically been resolved for no payment and insurance recoveries.

The Company has projected each subsidiary’s future asbestos-related liability costs with regard to pending and future unasserted claims based upon the Nicholson methodology.

The Nicholson methodology is a standard approach used by experts and has been accepted by numerous courts.

It is Colfax’s policy to record a liability for asbestos-related liability costs for the longest period of time that Colfax management can reasonably estimate.

The Company believes that it can reasonably estimate the asbestos-related liability for pending and future claims that will be resolved in the next 15 years and has recorded that liability as its best estimate.

While it is reasonably possible that the subsidiaries will incur costs after this period, the Company does not believe the reasonably possible loss or a range of reasonably possible losses is estimable at the current time.

Accordingly, no accrual has been recorded for any costs which may be paid after the next 15 years.

Defense costs associated with asbestos-related liabilities as well as costs incurred related to efforts to recover insurance from the subsidiaries’ insurers are expensed as incurred.

Each subsidiary has separate insurance coverage acquired prior to Company ownership of each independent entity.

The Company has evaluated the insurance assets for each subsidiary based upon the applicable policy language and allocation methodologies, and law pertaining to the affected subsidiary’s insurance policies.

One of the subsidiaries was notified in 2010 by the primary and umbrella carrier who had been fully defending and indemnifying the subsidiary for 20 years th at the limits of liability of its primary and umbrella layer policies had been exhausted.

The subsidiary has sought coverage from certain excess layer insurers whose coverage obligations were disputed in Delaware state court, and were the subject of various rulings, including a September 12, 2016 ruling on certain appealed issues by the Delaware Supreme Court.

This litigation confirmed that asbestos-related costs should be allocated among excess insurers using an “all sums” allocation (which allows an insured to collect all sums paid in connection with a claim from any insurer whose policy is triggered, up to the policy’s applicable limits), that the subsidiary has the right to access coverage available under excess insurance policies purchased by a former owner of the business, and that, the subsidiary has a right to immediately access the excess layer policies.

Further, the Delaware Supreme Court ruled in the subsidiary’s favor on a “trigger of coverage” issue, holding that every policy in place during or after the date of a claimant’s first significant exposure to asbestos was “triggered” and potentially could be accessed to cover that claimant’s claim.

The Court also largely affirmed but reversed in part some of the prior lower court rulings on defense obligations and whether payment of defense costs erode policy limits or are payable in addition to policy limits.

Final judgment in the case was entered in May 2021.

Based upon the final judgment, the Company currently estimates that the subsidiary’s future expected recovery percentage is 90.4 % of asbestos-related costs, with the subsidiary expected to be responsible for 9.6 % of its future asbestos-related costs.

Since approximately mid-2011, the Company had funded $ 174.8 million of the subsidiary’s asbestos-related defense and indemnity costs through December 31, 2021, which it has recovered or expects to recover from insurers.

Based on the above-referenced court rulings, the Company requested that its insurers reimburse all of the $ 94.9 million that remained outstanding at the time of the ruling, and the Company currently has received substantially all of that amount.

The subsidiary has requested

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

that certain excess insurers provide ongoing coverage for future asbestos-related defense and/or indemnity costs.

In the interim, and while not impacting the results of operations, the Company’s cash funding for future asbestos-related defense and indemnity costs for which it expects reimbursement from insurers could range up to $ 10 million per quarter.

In 2003, another subsidiary filed a lawsuit against a large number of its insurers and its former parent to resolve a variety of disputes concerning insurance for asbestos-related bodily injury claims asserted against it.

Court rulings in 2007 and 2009 clarified the insurers allocation methodology as mandated by the New Jersey courts, the allocation calculation related to amounts currently due from insurers, and amounts the Company expects to be reimbursed for asbestos-related costs incurred in future periods.

A final judgment at the trial court level was rendered in 2011 and confirmed by the Appellate Division in 2014.

In 2015, the New Jersey Supreme Court refused to grant certification of the appeals, effectively ending the matter.

The subsidiary expects to be responsible for 26.8 % of all future projected asbestos-related costs.

During the year ended December 31, 2021, the Company recorded a $ 9.5 million increase in asbestos-related liabilities due to a revision in forecast assumptions for filing rates and resolution values.

Th e related insurance asset was accordingly increased $ 4.6 million, resul ting in a net pre-tax cha rge of $ 4.9 million.

During the year ended December 31, 2020, the Company recorded a $ 11.6 million increase in asbestos-related liabilities due to a revision in forecast assumptions for filing rates and resolution values.

The related insurance asset was accordingly increased $ 3.9 million, resulting in a net pre-tax charge of $ 7.7 million.

During the year ended December 31, 2019, the Company recorded a $ 28.4 million increase in asbestos-related liabilities due to a revision in forecast assumptions for filing rates and resolution values.

The related insurance asset was accordingly increased $ 15.1 million, resulting in a net pre-tax charge of $ 13.3 million.

Fo r all periods, the net pre-tax charge is included in Loss from discontinued operations, net of taxes in the Consolidated Statements of Operations.

The Company’s Consolidated Balance Sheets included the following amounts related to asbestos-related litigation:

(In thousands)

Current asbestos insurance receivable (1)

Long-term asbestos insurance asset (2)

231,900 232,712

Long-term asbestos insurance receivable (2)

15,421 31,815

Accrued asbestos liability (3)

30,572 41,626

Long-term asbestos liability (4)

261,779 253,144

(1) Included in Other current assets in the Consolidated Balance Sheets.

(2) Included in Other assets in the Consolidated Balance Sheets.

(3) Represents current accruals for probable and reasonably estimable asbestos-related liability costs that the Company believes the subsidiaries will pay, and unpaid legal costs related to defending themselves against asbestos-related liability claims and legal action against the Company’s insurers, which is included in Accrued liabilities in the Consolidated Balance Sheets.

(4) Included in Other liabilities in the Consolidated Balance Sheets.

Management’s analyses are based on currently known facts and a number of assumptions.

However, projecting future events, such as new claims to be filed each year, the average cost of resolving each claim, coverage issues among layers of insurers, the method in which losses will be allocated to the various insurance policies, interpretation of the effect on coverage of various policy terms and limits and their interrelationships, the continuing solvency of various insurance companies and the collectability of claims tendered, the amount of remaining insurance available, as well as the numerous uncertainties inherent in asbestos litigation could cause the actual liabilities and insurance recoveries to be higher or lower than those projected or recorded which could materially affect the Company’s financial condition, results of operations or cash flow.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

General Litigation

The Company is also involved in various other pending legal proceedings arising out of the ordinary course of the Company’s business.

The Company is involved in various pending legal proceedings arising out of the ordinary course of the Company’s business.

None of these legal proceedings are expected to have a material adverse effect on the financial condition, results of operations or cash flow of the Company.

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There can be no assurance, however, as to the ultimate outcome of any of these matters, and if all or substantially all of these legal proceedings were to be determined adverse to the Company, there could be a material adverse effect on the financial condition, results of operations or cash flow of the Company.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Off-Balance Sheet Arrangements

As of December 31, 2022, the Company had $ 162.0 million of unconditional purchase obligations with suppliers, the majority of which is expected to be paid by December 31, 2023.

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Segment Information

The Company conducts its continuing operations through the Fabrication Technology and Medical Technology operating segments, which also represent the Company’s reportable segments.

• Fabrication Technology - a leading global supplier of consumable products and equipment for use in cutting, joining and automated welding, as well as gas control equipment, providing a wide range of products with innovative technologies to solve challenges in a wide range of industries.

• Medical Technology - a leader in orthopedic solutions, providing devices, software and services spanning the full continuum of patient care, from injury prevention to joint replacement to rehabilitation.

Certain amounts not allocated to the two reportable segments and intersegment eliminations are reported under the heading “Corporate and other.” The Company’s management evaluates the operating results of each of its reportable segments based upon Net sales and segment operating income (loss), which represents Operating income (loss) before restructuring and certain other charges.

The Company conducts its continuing operations through the Prevention & Recovery and Reconstructive operating segments, which also represent the Company’s reportable segments.

• Prevention & Recovery - a leader in orthopedic solutions and recovery sciences, providing devices, software and services across the patient care continuum from injury prevention to rehabilitation after surgery, injury, or from degenerative disease.

• Reconstructive - innovation market-leader positioned in the fast-growing surgical implant business, offering a comprehensive suite of reconstructive joint products for the hip, knee, shoulder, elbow, foot, ankle, and finger.

The Company’s management, including the chief operating decision maker, evaluates the operating results of each of its reportable segments based upon Net sales and Adjusted EBITDA, which excludes from Net loss from continuing operations the effect of restructuring and certain other charges, MDR and related costs, acquisition-related intangible asset amortization and other non-cash charges, strategic transaction costs, stock-based compensation, insurance settlement gain, and inventory step-up charges from the operating income of the Company’s operating segments.

The Company’s segment results were as follows:

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(In thousands)

Fabrication Technology $ 2,428,115 $ 1,950,069 $ 2,247,026

Medical Technology 1,426,188 1,120,700 1,080,432

Prevention & Recovery $ 1,027,628 $ 1,026,029 $ 863,150

Reconstructive 535,473 400,159 257,550

Total Net sales $ 1,563,101 $ 1,426,188 $ 1,120,700

Segment operating income (loss) (1) :

Fabrication Technology $ 356,315 $ 246,011 $ 302,601

Medical Technology 53,148 29,079 96,170

Corporate and other ( 112,003 ) ( 60,840 ) ( 121,412 )

Total segment operating income $ 297,460 $ 214,250 $ 277,359

Depreciation, amortization and other impairment charges:

Fabrication Technology $ 75,899 $ 76,644 $ 80,072

Medical Technology 185,786 168,227 134,001

Corporate and other 1,234 1,358 1,534

Total depreciation, amortization and other impairment charges $ 262,919 $ 246,229 $ 215,607

Segment Adjusted EBITDA (1) :

Prevention & Recovery $ 141,344 $ 133,500 $ 112,562

Reconstructive 94,726 72,496 48,973

Total Adjusted EBITDA (1)

$ 236,070 $ 205,996 $ 161,535

Depreciation, amortization and impairment

Prevention & Recovery $ 104,458 $ 97,898 $ 108,174

Reconstructive 98,507 89,091 59,729

Total depreciation, amortization and impairment $ 202,965 $ 186,989 $ 167,903

Capital expenditures:

Fabrication Technology $ 35,584 $ 40,137 $ 44,454

Medical Technology 68,591 74,624 57,326

Corporate and other 62 24 59

Prevention & Recovery $ 25,140 $ 19,514 $ 31,953

Reconstructive 74,407 49,077 42,671

Total capital expenditures $ 99,547 $ 68,591 $ 74,624

(1) The following is a reconciliation of Income from continuing operations before income taxes to segment operating income:

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(1) The following is a reconciliation of Income from continuing operations before income taxes to Adjusted EBITDA:

Year Ended December 31,

2022 2021 2020

Income from continuing operations before income taxes $ 165,388 $ 58,029 $ 50,493

Pension settlement loss (gain) ( 11,208 ) — 33,616

Interest expense, net 72,593 104,262 119,503

Debt extinguishment charges 29,870 — —

Restructuring and other related charges (1)

(In thousands)

Loss from continuing operations before income taxes (GAAP) $ ( 2,069 ) $ ( 121,781 ) $ ( 119,006 )

Restructuring and other charges (1)

18,960 13,914 23,314

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16,709 7,949 6,900

Segment operating income $ 297,460 $ 214,250 $ 277,359

COLFAX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(1) Restructuring and other related charges includes $ 5.2 million, $ 6.6 million and $ 8.5 million of expense classified as Cost of sales on the Company’s Consolidated Statements of Operations for the years ended December 31, 2021, 2020 and 2019, respectively.

Strategic transaction costs 61,024 23,448 2,800

Stock-based compensation 31,493 25,737 22,500

Depreciation and other amortization 76,664 70,069 64,597

Amortization of acquired intangibles 126,301 116,920 103,306

Insurance settlement gain (3)

( 36,705 ) — —

Inventory step-up 12,802 10,758 4,300

Interest expense, net 24,052 29,112 52,824

Debt extinguishment charges 20,396 29,870 —

Gain on investment in ESAB Corporation ( 102,669 ) — —

Gain on cost basis investment ( 8,800 ) — —

Other income ( 2,088 ) — —

Adjusted EBITDA (non-GAAP) $ 236,070 $ 205,996 $ 161,535

(1) Restructuring and other charges includes $ 1.7 million, $ 5.2 million and $ 6.6 million of expense classified as Cost of sales on the Company’s Consolidated Statements of Operations for the years ended December 31, 2022, 2021 and 2020, respectively.

(2) Primarily related to costs specific to compliance with medical device reporting regulations and other requirements of the European Union MDR.

These costs are classified as Selling, general and administrative expense on our Consolidated Statements of Operations.

(In thousands)

Investments in Equity Method Investees:

Fabrication Technology $ 28,180 $ 32,409

Medical Technology — —

(3) Insurance settlement gain is related to the 2019 acquisition of DJO.

2022 2021 (1)

(In thousands)

Total assets:

Fabrication Technology $ 3,459,301 $ 3,390,747

Medical Technology 4,077,403 3,575,644

Corporate and other 978,641 385,158

Prevention & Recovery $ 2,470,917 $ 2,966,646

Reconstructive 1,802,331 1,854,603

Total $ 4,273,248 $ 4,821,249

(1) Represents assets from continuing operations including allocation of centrally managed cash and cash equivalents.

Total assets related to discontinued operations was $ 3.7 billion.

The detail of the Company’s operations by geography is as follows:

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(1) The Company attributes revenues from external customers to individual countries based upon the country in which the sale was originated.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(In thousands)

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Switzerland 41,113 47,721

Czech Republic 63,273 65,188

India 37,349 39,612

Germany 16,450 15,440

Mexico 6,605 4,085

Australia 3,528 3,002

Other foreign locations 11,148 11,792

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(1) As the Company does not allocate all long-lived assets (specifically intangible assets) to each individual country, evaluation of long-lived assets in total is impracticable.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Selected Quarterly Data—(unaudited)

Provided below is selected unaudited quarterly financial data for the years ended December 31, 2022 and 2021.

Quarter Ended

September 30,

(In thousands, except per share data)

Net sales $ 375,457 $ 395,117 $ 383,814 $ 408,713

Gross profit 205,900 215,906 215,824 231,753

Net income (loss) from continuing operations ( 38,055 ) 120,651 ( 65,949 ) ( 54,836 )

Income (loss) from discontinued operations, net of taxes 54,356 ( 43,666 ) ( 527 ) 16,267

net income attributable to noncontrolling interest from continuing operations - net of taxes 267 130 136 34

net income attributable to noncontrolling interest from discontinued operations - net of taxes 966 — — —

Net income (loss) attributable to Enovis Corporation 15,068 76,855 ( 66,612 ) ( 38,603 )

Net income (loss) per share - basic

Continuing operations $ ( 0.76 ) $ 2.23 $ ( 1.22 ) $ ( 1.01 )

Discontinued operations $ 1.04 $ ( 0.81 ) $ ( 0.01 ) $ 0.30

Consolidated operations $ 0.28 $ 1.42 $ ( 1.23 ) $ ( 0.71 )

Net income (loss) per share - diluted

Continuing operations $ ( 0.76 ) $ 2.21 $ ( 1.22 ) $ ( 1.01 )

Discontinued operations $ 1.04 $ ( 0.80 ) $ ( 0.01 ) $ 0.30

Consolidated operations $ 0.28 $ 1.41 $ ( 1.23 ) $ ( 0.71 )

(1) The results for the quarter ended July 1, 2022 include the impact of a $ 135.5 million gain on the Company’s investment in ESAB, an insurance settlement gain of $ 33.0 million and debt extinguishment charges of $ 20.1 million.

(2) The results for the quarter ended September 30, 2022 include the impact of a $ 63.1 million loss on the Company’s investment in ESAB and an $ 8.8 million gain on the Company’s investment in Insight.

(3) The results for the quarter ended December 31, 2022 include income tax expense of $ 52.3 million which includes tax impacts associated with transaction costs, a $ 30.3 million gain on the Company’s investment in ESAB, and an insurance settlement gain of $ 4.6 million.

ENOVIS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Quarter Ended

2021 December 31,

(In thousands, except per share data)

Net sales $ 311,083 $ 356,124 $ 359,923 $ 399,058

Gross profit 171,282 200,593 197,876 207,924

Net loss from continuing operations ( 31,854 ) ( 42,127 ) ( 13,578 ) ( 14,694 )

Income from discontinued operations, net of taxes

52,094 71,829 40,435 14,173

net income attributable to noncontrolling interest from continuing operations - net of taxes 290 355 191 216

net income attributable to noncontrolling interest from discontinued operations - net of taxes 876 705 818 1,170

Net income (loss) attributable to Enovis Corporation 19,074 28,642 25,848 ( 1,907 )

Net income (loss) per share - basic

Continuing operations $ ( 0.69 ) $ ( 0.83 ) $ ( 0.26 ) $ ( 0.28 )

Discontinued operations $ 1.10 $ 1.39 $ 0.75 $ 0.24

Consolidated operations $ 0.41 $ 0.56 $ 0.49 $ ( 0.04 )

Net income (loss) per share - diluted

Continuing operations $ ( 0.69 ) $ ( 0.83 ) $ ( 0.26 ) $ ( 0.28 )

Discontinued operations $ 1.10 $ 1.39 $ 0.75 $ 0.24

Consolidated operations $ 0.40 $ 0.56 $ 0.49 $ ( 0.04 )

(1) The results for the quarter ended July 2, 2021 include a $ 29.9 million impact from debt extinguishment charges.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data