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Item 9A. Controls and Procedures

2024-02-28 compared with 2023-02-22 · 380 added, 395 removed, 1483 unchanged (34% of the section changed)

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OTHER INFORMATION

The following disclosure is intended to satisfy any obligation to provide disclosures pursuant to Item 5.03 of Form 8-K.

Effective as of February 21, 2023, based on the recommendation of the Nominating and Corporate Governance Committee of the Board of Directors (the “Board”) of Integra LifeSciences Holdings Corporation (the “Company”), in connection with the new Securities and Exchange Commission rules and changes to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), regarding universal proxy cards, certain recent changes to the Delaware General Corporation Law (the "DGCL"), and a periodic review of corporate governance matters, the Board approved amendments to the Company’s Second Amended and Restated Bylaws, as amended (the “Third A&R Bylaws”).

The Third A&R Bylaws, among other things:

• Address matters relating to Rule 14a-19 under the Exchange Act (the "Universal Proxy Rules"), including requiring:

(a) the stockholder’s nomination notice to include a representation that it intends to solicit proxies from stockholders representing at least 67% of the voting power of shares entitled to vote on the election of directors;

(b) the stockholder to comply with the Universal Proxy Rules and provide reasonable evidence thereof prior to the stockholder meeting;

and (c) the stockholder to use a proxy card color other than white, which is reserved for the exclusive use of the Board.

(Article 2, Sections 2.03, 2.08, and 2.10)

• Enhance the informational and procedural requirements in connection with stockholder proposals and stockholder director nominations, including:

(a) requiring additional information about the stockholder making the director

nomination or proposal;

(b) requiring additional information about the stockholder proposed business and/or director nominee;

and (c) providing that the number of nominees a stockholder may nominate for election at the annual meeting of the stockholders may not exceed the number of directors to be elected at such annual meeting.

(Article 2, Sections 2.03 and 2.10)

• Modify the provisions relating to adjournment procedures, availability of lists of stockholders entitled to vote at stockholder meetings, and electronic notices, in each case, to reflect amendments to the DGCL.

(Article 2, Sections 2.04 and 2.05;

Article 4, Section 4.01)

• Provide that any proxies received for disqualified or withdrawn Board nominees will be treated as abstentions.

(Article 2, Section 2.08)

• Add a provision for stockholder actions by written consent that requires the Company to engage an independent inspector of election to perform a review of the validity of the applicable consents and revocations.

(Article 2, Section 2.09)

• Clarify the powers of the chair of a stockholder meeting, including with respect to the chair’s ability to prescribe rules and regulations for the conduct of the meeting.

(Article 2, Section 2.11)

• Add a federal forum provision to designate the federal district courts as the exclusive forum for matters arising under the Securities Act of 1933, as amended, and the Exchange Act.

(Article 8, Section 8.02)

• Make various other updates, including ministerial and conforming changes and changes to clarify the Company’s ability to conduct business by means of remote communication.

The foregoing description of the Third A&R Bylaws is qualified in its entirety by the full text of the Third A&R Bylaws filed as Exhibit 3.3 hereto and incorporated herein by reference.

Not applicable.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

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Certain Relationships and Related Transactions, and Director Independence and Item 14.

Principal Accountant Fees and Services is incorporated herein by reference to the Company’s definitive proxy statement for its Annual Meeting of Stockholders sche duled to be held on May 12, 2023, w hich definitive proxy statement is expected to be filed with the Commission not later than 120 days after the end of the fiscal year to which this report relates.

Principal Accountant Fees and Services is incorporated herein by reference to the Company’s definitive proxy statement for its Annual Meeting of Stockholders scheduled to be held on May 9, 2024, which definitive proxy statement is expected to be filed with the Commission not later than 120 days after the end of the fiscal year to which this report relates.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULE

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Financial Statements.

The following financial statements and financial statement schedules are filed as a part of this report:

The following financial statements are filed as a part of this report:

Report of Independent Registered Public Accounting Firm (PricewaterhouseCoopers LLP, Florham Park, New Jersey, PCAOB ID# 238 )

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dated as of December 15, 2020 (Incorporated by reference to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020)

2.1(c)+ Stock Purchase Agreement, dated December 12, 2023, among Ethicon, Inc., Integra LifeSciences Holdings Corporation and Integra LifeSciences Israel Ltd.

3.1(a) Amended and Restated Certificate of Incorporation of the Company dated February 16, 1993 (Incorporated by reference to Exhibit 3.1(a) to the Company’s Annual Report on Form 10-K for the year ended December 31, 2005)

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3.1(d) Certificate of Amendment to Amended and Restated Certificate of Incorporation of the Company dated December 21, 2016 (Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on December 22, 2016)

3.2 Second Amended and Restated Bylaws of Integra LifeSciences Holdings Corporation, effective as of December 11, 2018 (Incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-k filed on December 12, 2018)

3.2 Third Amended and Restated Bylaws of Integra LifeSciences Holdings Corporation, effective as of February 21, 2023

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10.3(g)* Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on May 18, 2021)

10.3(h) Form of Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan Restricted Stock Award Agreement – Directors*+

10.3(i) Form of Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan Restricted Stock Agreement – Executive Officers*+

10.3(j) Form of Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan Performance Stock Unit Award Agreement*+

10.3(k) Form of Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan Non-Qualified Stock Option Award Agreement*+

10.3(l) Form of Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan Restricted Stock Award Agreement – OUS*+

10.3(h)* Form of Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan Restricted Stock Award Agreement – Directors (Incorporated by reference to Exhibit 10.3(h) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022)

10.3(i)* Form of Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan Restricted Stock Agreement – Executive Officers (Incorporated by reference to Exhibit 10.3(i) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022)

10.3(j)* Form of Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan Performance Stock Unit Award Agreement (Incorporated by reference to Exhibit 10.3(j) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022)

10.3(k)* Form of Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan Non-Qualified Stock Option Award Agreement (Incorporated by reference to Exhibit 10.3(k) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022)

10.3(l)* Form of Integra LifeSciences Holdings Corporation Fifth Amended and Restated 2003 Equity Incentive Plan Restricted Stock Award Agreement – OUS (Incorporated by reference to Exhibit 10.3(l) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022

10.4* Form of Indemnification Agreement, by and between Integra LifeSciences Holdings Corporation and each of its directors and executive officers (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on July 19, 2022)

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10.11(b)* Separation Agreement and General Release, dated September 23, 2022, by and between Glenn Coleman, Integra LifeSciences Corporation and Integra LifeSciences Holdings Corporation (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on September 23, 2022)

10.12 Anderson Offer Summary, effective June 24, 2019(Incorporated by reference to the Current Report on Form 8-K filed on June 24, 2019)*

10.12(a) Receivables Financing Agreement, dated as of December 21, 2018, by and among Integra Receivables LLC, Integra LifeSciences Sales LLC, as Servicer, PNC Bank, National Association, as Administrative Agent, PNC Capital Markets LLC, as Structuring Agent, and certain lenders and group agents that are parties thereto from time to time (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 28, 2018)

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3 to Receivables Financing Agreement and Reaffirmation of Performance Guaranty, dated as of May 28, 2021, by and among, Integra Receivables LLC, Integra LifeSciences Sales LLC, as Servicer, PNC Bank, National Associations, as Administrative Agent, PNC Capital Markets LLC, as Structuring Agent, Committed Lender and Group Agent, and certain lenders and group agents that are parties thereto from time to time (Incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021)

10.12(e) Amendment No.

4 to Receivables Financing Agreement and Reaffirmation of Performance Guaranty, dated as of April 17, 2023, by and among, Integra Receivables LLC, Integra LifeSciences Sales LLC, as Servicer, PNC Bank, National Associations, as Administrative Agent, PNC Capital Markets LLC, as Structuring Agent, Committed Lender and Group Agent, and certain lenders and group agents that are parties thereto from time to time (Incorporated by reference to Exhibit 10.4 to the Company Quarterly Report on Form 10-Q for the quarter ended March 31, 2023)

10.12(f)+ Amendment No.

5 to Receivables Financing Agreement and Reaffirmation of Performance Guaranty, dated as of December 15, 2023, by and among, Integra Receivables LLC, Integra LifeSciences Sales LLC, as Servicer, PNC Bank, National Associations, as Administrative Agent, PNC Capital Markets LLC, as Structuring Agent, Committed Lender and Group Agent, The Bank of Nova Scotia, as Committed Lender and Group Agent, and certain lenders and group agents that are parties thereto from time to time

10.13 Purchase and Sale Agreement, dated as of December 21, 2018, by and among Integra LifeSciences Sales LLC, Integra LifeSciences Corporation and Integra Receivables LLC (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 28, 2018)

10.15(a) Sixth Amended and Restated Credit Agreement, dated as of February 3, 2020, among Integra LifeSciences Holdings Corporation, the lenders party thereto, Bank of America, N.A., as Administrative Agent, Swing Line Lender and an L/C Issuer, Citibank N.A., Morgan Stanley MUFG Loan Partners, LLC and Wells Fargo Bank, N.A., as Co-Syndication Agents, and PNC Bank, N.A., Bank of Nova Scotia, Bank of the West, BBVA USA, Capital One, National Association, Citizens Bank, N.A., DNB Capital LLC, Santander Bank, N.A., TD Bank, N.A.

and Truist Bank, as Co-Documentation Agents.

(Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 3, 2020).

10.15(b) Amendment, dated July 14, 2020, to that Sixth Amended and Restated Credit Agreement, among Integra LifeSciences Holdings Corporation, a syndicate of lending banks, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, Citibank N.A., Morgan Stanley MUFG Loan Partners, LLC and Wells Fargo Bank, N.A.

as Co-Syndication Agents, and PNC Bank, N.A., Bank of Nova Scotia, Bank of the West, BBVA USA, Capital One, National Association, Citizens Bank, N.A., DNB Capital LLC, Santander Bank, N.A., T.D.

and Truist Bank, as Co-Documentation Agents (as amended, restated, modified and supplemented from time to time prior to the date hereof, the “Credit Agreement”) (Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on July 20, 2020).

10.14 Seventh Amended and Restated Credit Agreement, dated as of March 24, 2023, among Integra LifeSciences Holdings Corporation, the lenders party thereto, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, Citibank N.A., JPMorgan Chase Bank, N.A., Morgan Stanley MUFG Loan Partners, LLC, PNC Bank, N.A., Truist Securities, Inc.

and Wells Fargo Bank, N.A., as Co-Syndication Agents, and The Bank of Nova Scotia, BMO Harris Bank N.A., BNP Paribas, Capital One, National Association, Citizens Bank, N.A., DNB Bank ASA, New York Branch, Santander Bank, N.A.

and TD Bank, N.A., as Co-Documentation (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on March 24, 2023)

10.15 Base Call Option Transaction Confirmation, dated as of February 4, 2020, between Integra LifeSciences Holdings Corporation and Citibank, N.A.

(Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 7, 2020)

10.17 Ratification Agreement, dated as of February 3, 2020, between Integra LifeSciences Holdings Corporation, the Subsidiary Guarantors of Integra LifeSciences Holdings Corporation and Bank of America, N.A., as Administrative Agent (Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on February 3, 2020)

10.16 Ratification Agreement, dated as of March 24, 2023, between Integra LifeSciences Holdings Corporation, the Subsidiary Guarantors of Integra LifeSciences Holdings Corporation and Bank of America, N.A., as Administrative Agent (Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on March 24, 2023)

10.17 Base Call Option Transaction Confirmation, dated as of February 4, 2020, between Integra LifeSciences Holdings Corporation and Morgan Stanley & Co.

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32.2+ Certification of Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS XBRL Instance Document+#

101.SCH XBRL Taxonomy Extension Schema Document+#

101.CAL XBRL Taxonomy Extension Calculation Linkbase Document+#

101.DEF XBRL Definition Linkbase Document

101.LAB XBRL Taxonomy Extension Labels Linkbase Document+#

101.PRE XBRL Taxonomy Extension Presentation Linkbase Document+#

97.1+ Integra LifeSciences Holdings Corporation Incentive Compensation Recovery Policy

101.INS+# Inline XBRL Instance Document

101.SCH+# Inline XBRL Taxonomy Extension Schema Document

101.CAL+# Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF Inline XBRL Definition Linkbase Document

101.LAB+# Inline XBRL Taxonomy Extension Labels Linkbase Document

101.PRE+# Inline XBRL Taxonomy Extension Presentation Linkbase Document

104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

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/s/ Jan De Witte

President and Chief Executive Officer

President and Chief Executive Officer, and Director

(Principal Executive Officer)

/s/ Lea Knight

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

/s/ Jeffrey A.

Senior Vice President, Finance

(Principal Financial Officer and Principal Accounting Officer)

(Principal Accounting Officer)

February 28, 2024

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Jan De Witte and Director (Principal Executive Officer)

/s/ Lea Knight Executive Vice President and Chief Financial Officer February 28, 2024

Lea Knight (Principal Financial Officer)

/s/ Jeffrey A.

Mosebrook Senior Vice President, Finance February 28, 2024

Mosebrook (Principal Financial Officer and Principal Accounting Officer)

Mosebrook (Principal Accounting Officer)

/s/ Stuart M.

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Shaundra Clay

/s/ Jeffrey A.

Graves Director February 28, 2024

/s/ Barbara B.

Hill Director February 28, 2024

/s/ Renee Lo Director February 22, 2023

/s/ Donald E.

Morel, Jr., Ph.D.

Director February 22, 2023

Morel, Jr., Ph.D.

Lo Director February 28, 2024

/s/ Raymond G.

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Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Change in Accounting Principle

As discussed in Note 2 to the consolidated financial statements, the Company changed the manner in which it accounts for convertible instruments in 2021.

Basis for Opinions

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A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and

that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

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

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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 matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Surgical Innovation Associates, Inc.

Acquisition - Valuation of Developed Technology Intangible Asset

As described in Note 4 to the consolidated financial statements, on December 6, 2022, the Company completed its acquisition of Surgical Innovation Associates, Inc.

(SIA) for an acquisition purchase price of $51.5 million, and will pay up to an additional $50 million upon the achievement of certain revenue-based performance milestones in 2023, 2024, and 2025 and up to an additional $40.0M upon the approval by the FDA of the Premarketing Approval Application for DuraSorb.

The acquisition also resulted in a $75 million developed technology intangible asset being recorded.

The estimated fair value of the developed technology acquired was determined by management using the multi-period excess earnings method of the income approach.

Management’s significant assumptions used in the estimate of fair value included the estimated net cash flows, including net revenues, cost of sales, research and development costs, selling and marketing costs, working capital, contributory asset charges, discount rate, the asset’s life cycle, and competitive trends impacting the asset and the cash flow stream.

The principal considerations for our determination that performing procedures relating to the valuation of developed technology intangible asset from the acquisition of Surgical Innovation Associates, Inc.

is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the acquired developed technology intangible asset, (ii) a high degree of auditor judgment , subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to net revenues, cost of sales, discount rate and the asset’s life cycle;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Interim Goodwill Impairment Assessment - Tissue Technologies Reporting unit

As described in Notes 2 and 7 to the consolidated financial statements, the Company has three reporting units and the total goodwill balance was $1,055 million as of December 31, 2023, of which $388.5 million relates to the Tissue Technologies reporting unit.

Goodwill is tested by management for impairment at the reporting unit level annually during the third quarter every year, or more frequently if impairment indicators arise.

Management's assessment of the recoverability of goodwill is based upon a comparison of the carrying value of goodwill with its estimated fair value.

As disclosed by management, in the second quarter of 2023, due to the voluntary global recall of all products manufactured at the Boston facility, as well as the associated drop in the Company's stock price in that quarter, management elected to perform a quantitative analysis, using a combination of a discounted cash flow method and guideline public company method for its Tissue Technologies reporting unit.

The quantitative test utilized assumptions of revenue growth rate, terminal growth rate, discount rate, and the range and application of company guideline multiples.

Management determined, after performing the quantitative analysis, that the fair value of the goodwill of the reporting unit was not less than the carrying amount.

The principal considerations for our determination that performing procedures relating to the interim goodwill impairment assessment of the Tissue Technologies reporting unit is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the reporting unit;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management's significant assumptions related to the revenue growth rate, terminal growth rate, discount rate, and the range and application of company guideline multiples;

and (iii) the audit effort involved in the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the acquisition accounting, including controls over management’s valuation of the acquired developed technology intangible asset and controls over the development of significant assumptions related to net revenues, cost of sales, discount rate and the asset’s life cycle.

These procedures also included, among others (i) reading the purchase agreement and (ii) testing management’s process for developing the estimated fair value of the developed technology intangible asset.

Testing management’s process included evaluating the appropriateness of the multi-period excess earnings method, testing the completeness and accuracy of underlying data used in the method, and evaluating the reasonableness of significant assumptions used by management related to net revenues, cost of sales, discount rate and the asset’s life cycle.

Evaluating the reasonableness of management’s assumptions related to net revenues, cost of sales, and the asset’s life cycle involved considering (i) current and past performance of the product associated with the developed technology acquired;

These procedures included testing the effectiveness of controls relating to management's goodwill impairment assessment, including controls over the valuation of the Tissue Technologies reporting unit.

These procedures also included, among others (i) testing management's process for developing the fair value estimate of the Tissue Technologies reporting unit;

(ii) evaluating the appropriateness of the discounted cash flow and guideline public company methods used by management;

(iii) testing the completeness and accuracy of underlying data used by management in the discounted cash flow and guideline public company methods;

and (iv) evaluating the reasonableness of the significant assumptions used by management in the discounted cash flow method related to the revenue growth rate, terminal growth rate, and discount rate, and the significant assumption used by management in the guideline public company method related to the range and application of company guideline multiples.

Evaluating management's assumptions related to the revenue growth rates and terminal growth rate involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting unit;

(ii) the consistency with external market and industry data;

and (iii) whether the assumptions are consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the Company’s multi-period excess earnings method and (ii) the reasonableness of the discount rate and the asset’s life cycle assumptions.

and (iii) whether the assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the discounted cash flow and guideline public company methods and (ii) the reasonableness of the discount rate and the range and application of company guideline multiples assumptions.

/s/ PricewaterhouseCoopers LLP

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Income before income taxes 81,069 213,894 214,677

Provision (benefit) for income taxes 33,344 45,602 ( 40,372 )

Provision for income taxes 13,328 33,344 45,602

Net income $ 67,741 $ 180,550 $ 169,075

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Cash and cash equivalents $ 276,402 $ 456,661

Short-term investments 32,694 —

Trade accounts receivable, net of allowances of $ 4,879 and $ 4,304

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Inventories, net 389,608 324,583

Prepaid expenses and other current assets 116,789 91,051

Prepaid Expenses 67,362 85,757

Other Current Assets 32,643 31,032

Total current assets 1,058,036 1,161,498

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Depreciation and amortization 123,512 118,299 119,836

Non-cash in-process research and development expense — — 519

Non-cash impairment charges — — 2,754

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Non-cash lease expense 2,189 2,816 3,834

Accretion of bond issuance discount — — 15,415

Loss (Gain) on disposal of property and equipment and construction in-progress 777 ( 6,813 ) 2,240

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Acquired in-process research and development and intangibles — ( 4,742 ) ( 58 )

Purchases of Investments ( 32,694 ) — —

Cash paid for business acquisitions, net of cash acquired — ( 51,509 ) ( 303,910 )

Proceeds from sales of property and equipment — 11,145 3

Net proceeds (payments) on swaps designated as net investment hedges 4,909 76 ( 7,840 )

Net proceeds on swaps designated as net investment hedges 5,381 4,909 76

Net cash used in investing activities ( 94,178 ) ( 58,580 ) ( 161,443 )

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Payments on debt ( 110,600 ) ( 148,550 ) ( 125,500 )

Purchase of option hedge on convertible notes — — ( 104,248 )

Proceeds from convertible notes issuance — — 575,000

Proceeds from sale of stock purchase warrants — — 44,563

Payment of debt issuance costs ( 7,879 ) — ( 249 )

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Cash taxes paid in net equity settlement ( 5,863 ) ( 24,618 ) ( 4,801 )

Net cash (used in) provided by financing activities ( 251,953 ) ( 98,226 ) 121,625

Net cash used in financing activities ( 229,925 ) ( 251,953 ) ( 98,226 )

Effect of exchange rate changes on cash and cash equivalents 3,889 ( 10,723 ) ( 9,476 )

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Balance, January 1, 2021

89,251 $ 893 ( 4,914 ) $ ( 235,141 ) $ 1,290,908 $ ( 74,059 ) $ 532,266 $ 1,514,867

Net income — — — — — — 169,075 169,075

Other comprehensive loss, net of tax — — — — — 2,343 — 2,343

Other comprehensive income (loss), net of tax — — — — — 28,904 — 28,904

Treasury shares retirement — — — — — — — —

Issuance of common stock through employee stock purchase plan 18 — — — 1,127 — — 1,127

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Share-based compensation — 2 — — 35,981 — — 35,983

Share repurchase and equity component of the convertible note issuance, net — — — — 42,539 — — 42,539

Accelerated shares repurchased — — ( 2,060 ) ( 115,724 ) 15,724 — — ( 100,000 )

Adoption of Update No.

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Balance, December 31, 2021

89,600 896 ( 4,899 ) ( 234,448 ) 1,264,943 ( 45,155 ) 698,568 1,684,804

Net income — — — — — — 180,550 180,550

Other comprehensive loss, net of tax — — — — — 28,904 — 28,904

Other comprehensive income (loss), net of tax — — — — — 55,420 — 55,420

Issuance of common stock through employee stock purchase plan 17 — — 1,078 — — 1,078

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Share-based compensation — 2 — — 27,778 — — 27,780

Adoption of Update No.

2020-06 — — — — ( 63,274 ) — ( 2,773 ) ( 66,047 )

Accelerated shares repurchased — — ( 1,938 ) ( 129,152 ) 4,152 — — ( 125,000 )

Balance, December 31, 2022

90,476 $ 905 ( 6,823 ) $ ( 362,862 ) $ 1,276,977 $ 10,265 $ 879,118 $ 1,804,403

Net income — — — — — — 67,741 67,741

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Balance, December 31, 2023

90,920 909 ( 12,751 ) ( 647,262 ) 1,302,484 ( 15,106 ) 946,859 1,587,884

The accompanying notes are an integral part of these consolidated financial statements.

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Actual results could differ from these estimates.

As the Company continues to navigate the novel coronavirus ("COVID-19") pandemic and recent variants of the virus as well as the adverse impacts to global economic conditions, supply chain and the operations, there may be impact to future estimates including, but not limited to, inventory valuations, fair value measurements, goodwill and long-lived asset impairments, the effectiveness of the Company’s hedging instruments, deferred tax valuation allowances, and allowances for doubtful accounts receivable.

CASH AND CASH EQUIVALENTS

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These investments are carried at cost, which approximates fair value.

SHORT TERM INVESTMENTS

Short-term investments are securities with original maturities greater than 90 days that are available for use in our operations in the next twelve months.

The short-term investments, primarily consisting of time deposits, are recorded at cost, which approximates fair value, which is estimated based on the net asset value of these investments.

Interest and dividends are recorded in income when earned.

TRADE ACCOUNTS RECEIVABLE AND ALLOWANCES FOR DOUBTFUL ACCOUNTS RECEIVABLE

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments .

The Company adopted this guidance on January 1, 2020 using a modified retrospective transition method which requires a cumulative-effect adjustment to the opening balance of retained earnings to be recognized on the date of adoption with no change to financial results reported in prior periods.

The cumulative-effect adjustment recorded on January 1, 2020 was not material.

The adoption of this ASU did not have a significant impact on the Company's consolidated financial statements and related disclosures.

The Company's exposure to credit losses may increase if its customers are adversely affected by changes in healthcare laws, coverage, and reimbursement, economic pressures or uncertainty associated with local or global economic recessions, disruption associated with the COVID-19 pandemic and recent variants of the virus, and other customer-specific factors.

Although the Company has historically not experienced significant credit losses, it is possible that there could be an adverse impact due to customer and governmental responses to the COVID-19 pandemic.

Provisions to the allowances for doubtful accounts are recorded to selling, general and administrative expenses.

Account balances are charged off against the allowance when it is probable that the receivable will not be recovered.

Provision for doubtful accounts, net of recoveries, associated with accounts receivable, included in selling, general and administrative expense, was charges of $ 0.2 million for the year ended December 31, 2022, recoveries of $ 1.1 million, and charges of $ 3.6 million for the years ended December 31, 2021 and 2020, respectively.

The below table shows the rollforward of the allowance for doubtful accounts for the years ended December 31, 2022, 2021 and 2020:

Provision for doubtful accounts, net of recoveries, associated with accounts receivable, included in selling, general and administrative expense, was charges of $ 3.0 million for the year ended December 31, 2023, charges of $ 0.2 million, and recoveries of $ 1.1 million for the years ended December 31, 2022 and 2021, respectively.

The below table shows the roll forward of the allowance for doubtful accounts for the years ended December 31, 2023, 2022 and 2021:

Balance at Beginning of Period Charged to Costs and Expenses Other Deductions Balance at End of Period

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

In the twelve months ended December 31, 2023, due to the Boston recall, the Company recorded a $ 24.6 million write off of inventory to cost of goods sold that was no longer able to be sold.

PROPERTY, PLANT AND EQUIPMENT

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In an asset acquisition, the amount allocated to acquired IPR&D with no alternative future use is charged to expense at the acquisition date.

Payments that would be recognized as contingent consideration in a business combination are expensed when probable in an asset acquisition.

Payments that would be recognized as contingent consideration in a business combination are recognized when probable in an asset acquisition.

Refer to Note 4, Acquisitions and Divestitures for more information.

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therefore, its results are not included in these consolidated financial statements.

The Company contributed $ 0.0 million, $ 1.2 million and $ 0.8 million to the Integra Foundation during the years ended December 31, 2022, 2021 and 2020, respectively.

The Company made no contributions to the Integra Foundation during the years ended December 31, 2023 and 2022 and $ 1.2 million during the year ended December 31, 2021.

These contributions were recorded in selling, general, and administrative expense.

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subsidiaries.

Foreign currency transaction net losses of $ 3.3 million, net gains of less than $ 0.1 million, and net losses $ 1.6 million are reported in other income, net in the statements of operations, for the year ended December 31, 2022, 2021 and 2020, respectively.

Foreign currency transaction net losses of $ 4.4 million, net losses of $ 3.3 million, and net gains of less than $ 0.1 million are reported in other income, net in the statements of operations, for the year ended December 31, 2023, 2022 and 2021, respectively.

Income taxes are accounted for by using the asset and liability method.

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EMPLOYEE TERMINATION BENEFITS

The Company does not have a written severance plan, and it does not offer similar termination benefits to affected employees in all restructuring initiatives.

Accordingly, in situations where minimum statutory termination benefits must be paid to the affected employees, the Company records employee severance costs associated with these restructuring activities in accordance with the authoritative guidance for non-retirement post-employment benefits.

The Company does not have a written severance plan, but has a history of providing benefits for employees in the case of involuntary termination.

In situations outside the US, there are minimum statutory termination benefits requirements by country that must be paid to the affected employees.

The Company records employee severance costs associated with these restructuring activities in accordance with the authoritative guidance for non-retirement post-employment benefits.

Charges associated with these activities are recorded when the payment of benefits is probable and can be reasonably estimated.

In all other situations where the Company pays out termination benefits, including supplemental benefits paid in excess of statutory minimum amounts and benefits offered to affected employees based on management's discretion, the Company records these termination costs in accordance with the authoritative guidance for ASC Topic 712 Compensation - Nonretirement Benefits and ASC Topic 420 One-time Employee Termination Benefits .

In situations where the Company pays out termination benefits in excess of statutory minimum amounts based on management's discretion, the Company records these termination costs once communication is made to the affected employees.

The timing of the recognition of charges for employee severance costs other than minimum statutory benefits depends on whether the affected employees are required to render service beyond their legal notification period in order to receive the benefits.

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Otherwise, charges are recognized when management has approved a specific plan and employee communication requirements have been met.

The Company incurred employee termination costs on restructuring activities associated with a closure of a manufacturing facility in France and other reorganization projects in the consolidated statement of operations for the year ended December 31, 2022.

In 2021, the Company incurred employee termination costs on restructuring activities associated with the closure of a manufacturing facility in France.

The following table summarizes our restructuring related accrual balances included within accrued expenses and other current liabilities in the consolidated balance sheet for the year ended December 31, 2022 and 2021.

The Company incurred employee termination costs on sales force restructuring activities in the consolidated statement of operations for the year ended December 31, 2023.

In addition, the Company incurred employee termination costs on restructuring activities associated with a closure of a manufacturing facility in France and other reorganization projects in the consolidated statement of operations for the year ended December 31, 2022.

The following table summarizes the restructuring related accrual balances included within accrued expenses and other current liabilities in the consolidated balance sheet for the year ended December 31, 2023 and 2022.

Years Ended December 31,

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Balance, end of the year $ 2,113 $ 5,107

Included in the accrual balance as of December 31, 2022 is $ 2.0 million related to the closure o f a manufacturing facility located in France, and other reorganization projects of $ 3.1 M .

Included in the accrual balance as of December 31, 2021 is $ 10.2 million related to the closure o f the manufacturing facility located in France.

STOCK-BASED COMPENSATION

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Refer to Note 9, Stock-based Compensation for more information.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

PENSION BENEFITS

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Various factors are considered in determining the pension liability, including the number of employees expected to be paid their salary levels and years of service, the expected return on plan assets, the discount rate used to determine the benefit obligations, the timing of benefit payments and other actuarial assumptions.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Retirement benefit plan assumptions are reassessed on an annual basis or more frequently if changes in circumstances indicate a re-evaluation of assumptions are required.

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RECENT ACCOUNTING PRONOUNCEMENTS

In December 2019, the FASB issued ASU 2019-12, Income Taxes :

Simplifying the Accounting for Income Taxes, intended to simplify the accounting for income taxes by eliminating certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences.

This guidance also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill.

The standard is effective for annual periods beginning after December 15, 2020 and interim periods within, with early adoption permitted.

The Company adopted ASU 2019-12 as of January 1, 2021.

Adoption of the standard requires certain changes to be made prospectively, with some changes to be made retrospectively.

The adoption of this guidance did not have a significant impact on the Company's consolidated financial statements and related disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures which enhances the transparency of income tax disclosures by expanding annual disclosure requirements related to the rate reconciliation and income taxes paid.

The amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024.

Early adoption is permitted.

The amendments should be applied retrospectively to all prior periods presented in the financial statements.

The Company is currently evaluating this ASU to determine its impact on the Company's disclosures.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures, which updates reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses.

The amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024.

Early adoption is permitted.

The amendments should be applied retrospectively to all prior periods presented in the financial statements.

The Company does not plan to early adopt, but is currently evaluating this ASU to determine its impact on the Company's disclosures.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848), and subsequent amendment to the initial guidance:

In March 2020, the Financial Accounting Standards Board ("FASB") issued ASU 2020-04, Reference Rate Reform (Topic 848), and subsequent amendment to the initial guidance:

ASU 2021-01, Reference Rate Reform (Topic 848):

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The amendments apply only to contracts, hedging relationships, and other transactions that reference London Inter-Bank Offered Rate ("LIBOR") or another reference rate expected to be discontinued because of reference rate reform.

The guidance generally can be applied from March 12, 2020 through December 31, 2022.

On October 5, 2022, the FASB approved an extension of the sunset date of the reference rate reform from December 31, 2022 to December 31, 2024, past LIBOR’s end date.

The Company currently has contracts that are indexed to LIBOR and are continuing to evaluate the scope of impacted contracts and potential risk.

The Company expects all LIBOR-based contracts to be replaced by the Secured Overnight Financing Rate (“SOFR”), which is calculated based on overnight transactions under repurchase agreements backed by Treasury securities.

The guidance generally can be applied through December 31, 2024.

The Alternative Reference Rates Committee, a group of private-market participants convened by the U.S.

Federal Reserve Board and the New York Federal Reserve, has recommended the use of SOFR as a more robust reference rate alternative to LIBOR.

The use of SOFR as a substitute for LIBOR is, however, voluntary and may not be suitable for all market participants.

There can be no assurance that the replacement rate will be economically equivalent to LIBOR, which could result in higher interest rates for us under our debt facilities.

There is no guarantee that a transition from LIBOR to SOFR will not result in financial market disruptions, significant increases in benchmark rates, or our borrowing costs, any of which could have an adverse effect on our business, results of operations and financial condition.

In August 2020, the FASB issued ASU 2020-06, Debt- Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40):Accounting for Convertible Instruments and Contracts in an Entity's Own Equity .

The guidance simplifies accounting for convertible instruments by removing major separation models required under current GAAP.

Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features.

The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify.

The guidance also simplifies the diluted net income per share calculation in certain areas.

The ASU will be effective for annual and interim periods beginning after December 15, 2021, and early adoption is permitted for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years using either the modified retrospective or full retrospective method.

As detailed in Note 5, Debt , on February 4, 2020, the Company issued $ 575.0 million aggregate principal amount of its 0.5 % Convertible Senior Notes due 2025 (the "2025 Notes").

The 2025 Notes are subject to the guidance included in ASU 2020-06.

The Company adopted this guidance on January 1, 2021 using the modified retrospective approach which resulted in a cumulative-effect adjustment that increased (decreased) the following consolidated balance sheet accounts:

ADJUSTMENT CONSOLIDATED BALANCE SHEET CLASSIFICATION AMOUNT

(in millions)

Deferred tax impact of cumulative-effect adjustment Deferred tax liabilities $ ( 20.6 )

Debt discount reclassification Long-term convertible securities 89.1

Equity issuance costs reclassification Long-term convertible securities ( 2.5 )

Debt discount amortization and equity costs reclassification, net of tax Retained Earnings ( 2.8 )

Net impact of cumulative-effect adjustment Additional paid-in capital ( 63.3 )

On December 9, 2020, the Company made an irrevocable election under the indenture to require the principal portion of its 2025 Notes to be settled in cash and any excess in shares.

Following the irrevocable notice, only the amounts settled in excess of the principal will be considered in diluted earnings per share under the “if-converted” method.

Upon adoption of ASU 2020-06, the Company’s 2025 Notes were reflected entirely as a liability since the embedded conversion feature will no longer be separately presented within stockholders’ equity.

Additionally, from January 1, 2021, the Company is no longer incurring non-cash interest expense for the amortization of debt discount.

In October 2020, the FASB issued ASU 2020-10, Codification Improvements , which updates various codification topics by clarifying or improving disclosure requirements to align with the regulations of the U.S.

Securities and Exchange Commission (the "SEC") .

The ASU has been effective for the Company for annual and interim periods beginning after January 1, 2021.

The Company adopted this standard on the January 1, 2021.

The adoption of this guidance did not have a significant impact on the Company's consolidated financial statements and related disclosures.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40):

Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options which provides guidance to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange.

The amendments in this ASU No.

2021-04 are effective for all entities for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years, with early adoption permitted, including interim periods within those fiscal years.

The amendment currently has no impact to the Company as the effect will largely depend on the terms of written call options or financings issued or modified in the future.

There are no other recently issued accounting pronouncements that are expected to have any significant effect on the Company's financial position, results of operations or cash flows.

Federal Reserve Board and the New York Federal Reserve, has recommended the use of the Secured Overnight Financing Rate ("SOFR") as a more robust reference rate alternative to LIBOR.

On March 24, 2023, the Company entered into the seventh amendment and restatement (the "March 2023 Amendment") of its Senior Credit Facility (the “Senior Credit Facility”) with a syndicate of lending banks with Bank of America, N.A., as Administrative Agent.

In connection with the March 2023 Amendment, the Company replaced all LIBOR-based contracts with SOFR, which is calculated based on overnight transactions under repurchase agreements backed by Treasury securities.

In addition, on April 17, 2023 the Company entered into an amendment (the "April 2023 Amendment") of the Securitization Facility (as defined below) and amended the interest rate from LIBOR to SOFR indexed rate.

(See Note 6).

In March 2023, the Company entered into a basis swap where the Company receives Term SOFR and pays LIBOR to convert the portfolio of interest rate swaps from LIBOR to SOFR.

Integra has elected to adopt the optional expedient under ASC 848, which will allow the interest rate swap hedging relationship to continue, without de-designation, due to the change in the indexed rate from LIBOR to SOFR.

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

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The milestone was fully paid in 2022.

During the fourth quarter of 2020, the Company achieved another developmental milestone which triggered a $ 20.0 million obligation to be paid to the former shareholders of Rebound.

The Company recorded $ 20.0 million as an intangible asset in the consolidated balance sheet upon achieving the milestone.

The milestone was paid during the fourth quarter of 2020.

REVENUES FROM CONTRACTS WITH CUSTOMERS

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The Company has no significant multi-element contracts with customers.

Significant Judgments

Significant Estimates

Usage-based royalties and licenses are estimated based on the provisions of contracts with customers and recognized in the same period that the royalty-based products are sold by the Company's strategic partners.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Due to the voluntary recall in 2023 of all products manufactured at the Boston facility, including Primatrix®, Surgimend®, Revize™, and TissueMend™, the Boston recall, the Company recorded a total of $ 18.7 million provision for product returns, as a reduction of net revenue, and has credited $ 9.9 million to customers during the year ended December 31, 2023.

As of December 31, 2023, the return reserve was $ 8.8 million.

The Company disregards the effects of a financing component if the Company expects, at contract inception, that the period between the transfer and customer payment for the goods or services will be one year or less.

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Non-refundable fees received under multiple-period service agreements are recognized as revenue as the Company satisfies the performance obligations to the other party.

A portion of the transaction price allocated to the performance obligations to be satisfied in the future periods is recognized as contract liability.

A portion of the transaction price allocated to the performance obligations to be satisfied in the future periods is recognized as a contract liability.

The following table summarized the changes in the contract asset and liability balances for the year ended December 31, 2023:

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Contract asset, January 1, 2023

Transferred to trade receivable from contract asset included

in beginning of the year contract asset ( 11,412 )

Transferred to trade receivable from contract asset included in beginning of the year contract asset ( 7,743 )

Written off from beginning of the year contract asset due to Boston recall ( 2,379 )

Contract asset, net of transferred to trade receivables on contracts during the period 9,233

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At December 31, 2023, the short-term portion of the contract liability of $ 8.5 million and the long-term portion of $ 7.7 million is included in current liabilities and other liabilities, respectively, in the consolidated balance sheet.

As of December 31, 2022, the Company is expected to recognize revenue of approximately $ 7.3 million in 2023, $ 4.2 million in 2024, $ 2.7 million in 2025, $ 1.1 million in 2026, $ 0.7 million in 2027, and $ 0.1 million thereafter.

As of December 31, 2023, the Company is expected to recognize revenue from unsatisfied or partially satisfied performance obligations of approximately $ 8.5 million in 2024, $ 4.2 million in 2025, $ 2.1 million in 2026, $ 1.1 million in 2027, $ 0.2 million in 2028, and $ 0.1 million thereafter.

Shipping and Handling Fees

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The related shipping and freight charges incurred by the Company are included in the cost of goods sold.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Product Warranties

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The Company elected to exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Disaggregated Revenue

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373,986 406,689 392,463

Extremity Orthopedics (1)

Private Label 108,594 131,413 124,753

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Total revenue $ 1,541,573 $ 1,557,666 $ 1,542,448

(1) On January 4, 2021, the Company completed its sale of its Extremity Orthopedics business.

See Note 4, Acquisitions and Divestitures, for details

(1) See Note 4.

Acquisitions and Divestitures, for details around the ACell acquisition.

Acquisitions and Divestitures, for details around the ACell and SIA acquisitions.

(2) On August 31, 2022, the Company completed the sale of its non-core traditional wound care ("TWC") business.

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On December 6, 2022, the Company completed its acquisition of Surgical Innovation Associates, Inc.

("SIA") for an acquisition purchase price of $ 51.5 million.

("SIA") for an acquisition purchase price of $ 51.5 million (the "SIA Acquisition") plus contingent consideration of up to $ 90.0 million.

In addition to the purchase price, the acquisition includes two separate contingent considerations payments, which are dependent on 1) achieving certain revenue-based performance milestones in 2023, 2024, and 2025 (up to $ 50.0 million in additional payments), as well as 2) the approval by the FDA of the Premarket Approval (“PMA”) Application for DuraSorb for certain uses by certain timing targets (up to $ 40.0 million in additional payments).

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The following table summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date:

Dollars in thousands Valuation as of December 6, 2022 Weighted Average Life

Dollars in thousands Final Valuation Weighted Average Life

Current assets:

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Changes in assumptions utilized in the contingent consideration fair value estimates could result in an increase in the contingent consideration obligation and a corresponding charge to operating results.

As part of the acquisition, the Company is required to pay to the shareholder of SIA up to $ 90.0 million for two separate payments, which are dependent on 1) achieving certain revenue-based performance milestones in 2023, 2024, and 2025 (up to $ 50.0 million in additional payments), as well as 2) the approval by the FDA of the PMA for DuraSorb for certain uses by

The Company used iterations of the Monte Carlo simulation

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

certain timing targets (up to $ 40.0 million in additional payments).

The Company used iterations of the Monte Carlo simulation to calculate the fair value of the contingent consideration for the revenue-based milestone that considered the possible outcomes of scenarios related to each specific milestone for the revenue based performance milestone.

to calculate the fair value of the contingent consideration for the revenue-based milestone that considered the possible outcomes of scenarios related to each specific milestone for the revenue based performance milestone.

The Company used probabilities of achieving the conditions to calculate the fair value of the contingent consideration for the PMA approval milestone.

The Company estimated the fair value of the contingent consideration for the revenue based milestone to be $ 32.6 million at the acquisition date and $ 25.0 million for the PMA approval milestone.

For the twelve-month period ended December 31, 2023, the company estimates the fair value of contingent consideration for the revenue based milestone to be $ 41.8 million and PMA approval to be $ 26.9 million.

This is compared to $ 32.6 million and $ 25.0 million, respectively at the acquisition date.

Deferred Tax Liabilities

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This deposit will be utilized by the Company on future orders placed to Gentell for such products.

As of December 31, 2022, the Company had a deposit remaining of $ 8.3 million which is included in prepaid assets and recognized a payable due to Gentell of $ 2.7 million, which is included in the consolidated balance sheet within accrued expenses and other current liabilities.

As of December 31, 2023, the Company had a deposit remaining of $ 0.4 million which is included in prepaid assets.

In addition, there are outstanding balances related to the Company's ongoing purchase of MediHoney® and TCC-EZ® products subsequent to the close of the TWC divestiture..

Definitive Agreement to Acquire Acclarent Inc.

In December 2023, the Company entered into a definitive agreement to acquire Acclarent, Inc.

from Ethicon, Inc., a Johnson & Johnson MedTech company for $ 275 million in cash at closing, subject to customary purchase price adjustments, and an additional $ 5 million upon the achievement of certain regulatory milestones.

Acclarent is an innovator and market leader in Ear, Nose, Throat ("ENT") procedures and upon closing, Integra will be one of the leading providers of ENT products and technologies.

The transaction is expected to close by the second quarter of 2024 .

Sale of Extremity Orthopedics Business

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The Company received an aggregate purchase price of $ 240.0 million from Smith & Nephew and concurrently paid $ 41.5 million to the Consortium of Focused Orthopedists, LLC ("CFO") effectively terminating the licensing agreement between Integra and CFO relating to the development of shoulder arthroplasty products.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Assets and liabilities divested consisted of the following as of December 31, 2020 (dollar amounts in thousands):

Prepaid expenses and other current assets $ 713

Right of use asset - operating leases and Other assets 3,186

Deferred tax assets 6,589

Intangible assets, net 13,332

Property, plant and equipment, net 37,893

Goodwill 47,546

Inventories 52,845

Total assets held for sale $ 162,104

Other liabilities $ 336

Current portion of lease liability - operating leases 539

Accrued compensation 1,767

Deferred tax liabilities 3,440

Lease liability - operating leases 5,669

Total liabilities held for sale $ 11,751

The divestiture did not represent a strategic shift that had a major effect on the Company's operations and financial statements.

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The Company finalized the net working capital to Smith & Nephew as of December 31, 2021.

The Company also entered into a transition services agreement ("TSA") with Smit h & Nephew which requires the Company to provide certain services on behalf of Smith & Nephew for the duration of the period subsequent to the sale of the business as defined in the TSA.

The Company recognized a payable due to Smith & Nephew of $ 2.3 million as of December 31, 2022, which is included in the consolidated balance sheet within accrued expenses and other current liabilities.

The TSA includes services such as invoicing and cash collections from customers on behalf of Smith & Nephew.

As of December 31, 2022, the Company has concluded the majority of the transition services agreement, pending final payment.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

On January 20, 2021, the Company acquired ACell, Inc.

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This method requires that assets acquired and liabilities assumed in a business combination are recognized at their fair values as of the acquisition date.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table summarizes the final fair values of the assets acquired and liabilities assumed at the acquisition date:

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For these and other reasons, actual results may vary significantly from estimated results.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company allocated goodwill related to the ACell acquisition to the Tissue Technologies segment.

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Goodwill recognized as a result of this acquisition is non-deductible for income tax purposes.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Contingent Consideration

As part of the acquisition, the Company is required to make payments to the former shareholders of ACell up to $ 100 million based on the achievement of certain revenue-based performance milestones in 2022, 2023, and 2025.

Based on revenue performance in 2022, no payment will be made for the first performance milestone.

T he Company used iterations of the Monte Carlo simulation to calculate the fair value of the contingent consideration that considered the possible outcomes of scenarios related to each specific milestone.

The Company estimated the fair value of the contingent consideration to be $ 23.9 million at the acquisition date.

The Company recorded $ 3.7 million and $ 21.8 million in other liabilities as of December 31, 2022 and 2021, respectively, in the consolidated balance sheets of the Company.

The change in the fair value of the contingent obligation was primarily as a result of changes in the timing and amount of revenue estimates.

The Company determined the acquisition date fair value of contingent consideration obligations using a Monte Carlo simulation, as well as significant unobservable inputs, reflecting the Company’s assessment of the assumptions market participants would use to value these liabilities.

The fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined using the fair value concepts in ASC 820.

The resultant most likely payouts are discounted using an appropriate effective annual interest rate.

At each reporting date, the contingent consideration obligations is revalued to estimated fair value and changes in fair value will be reflected as income or expense in our consolidated statement of operations.

Changes in the fair value of the contingent considerations may result from changes in discount periods and rates and changes in the timing and amount of revenue estimates.

As part of the acquisition of ACell (the "ACell Acquisition"), the Company is required to make payments to the former shareholders of ACell up to $ 50 million based on the achievement by the Company of certain revenue-based performance milestones in 2023 and $ 50 million in 2025.

The 2023 milestone was not achieved, leaving only one contingent milestone remaining.

The Company used iterations of the Monte Carlo simulation to calculate the fair value of the contingent consideration that considered the possible outcomes of scenarios related to each specific milestone.

For the twelve-month period ended December 31, 2023, the company estimates the fair value of the contingent obligation to be $ 0.3 million.

This is compared to $ 23.9 million at the acquisition date, and $ 3.7 million at December 31, 2022.

Deferred Tax Liabilities

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These adjustments create excess book basis over tax basis which is tax-effected by the statutory tax rates of applicable jurisdictions.

Amendment to the Sixth Amended and Restated Senior Credit Agreement

On February 3, 2020, the Company entered into the sixth amendment and restatement (the "February 2020 Amendment") of its Senior Credit Facility (the "Senior Credit Facility") with a syndicate of lending banks with Bank of America, N.A., as Administrative Agent.

The February 2020 Amendment extended the maturity date to February 3, 2025.

Amendment to the Seventh Amended and Restated Senior Credit Agreement

On March 24, 2023, the Company entered into the seventh amendment and restatement (the "March 2023 Amendment") of the Senior Credit Facility (the "Senior Credit Facility") with a syndicate of lending banks with Bank of America, N.A., as Administrative Agent.

The March 2023 Amendment extended the maturity date to March 24, 2028, amended the contractual repayments of the term loan component, and amended the interest rate from LIBOR to SOFR-indexed interest.

The Company continues to have the aggregate principal amount of up to approximately $ 2.1 billion available to it through the following facilities:

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The Company’s maximum consolidated total leverage ratio in the financial covenants (as defined in the Senior Credit Facility) is the following:

Fiscal Quarter Maximum Consolidated Total Leverage Ratio

September 30, 2022 through June 30, 2023 4.50 to 1.00

Fiscal Quarter Ending Maximum Consolidated Total Leverage Ratio

March 31, 2023 through December 31, 2024 4.50 to 1.00

March 31, 2025 through June 30, 2026 4.25 to 1.00

September 30, 2026 and the last day of each fiscal quarter thereafter 4.00 to 1.00

Borrowings under the Senior Credit Facility bear interest, at the Company’s option, at a rate equal to the following:

the Eurodollar Rate (as defined in the amendment and restatement) in effect from time to time plus the applicable rate (ranging from 1.00 % to 2.25 %), or

Term SOFR in effect from time to time plus 0.10 % plus the applicable rate (ranging from 1.00 % to 1.75 %), or

the highest of:

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the prime lending rate of Bank of America, N.A.

the one-month Eurodollar Rate plus 1.00 %

The applicable rates are based on the Company’s consolidated total leverage ratio (defined as the ratio of (a) consolidated funded indebtedness as of such date less cash that is not subject to any restriction on the use or investment thereof to (b) consolidated EBITDA (as defined by the July 2020 amendment), for the period of four consecutive fiscal quarters ending on such date).

the one-month Term SOFR plus 1.00 %

The applicable rates are based on the Company’s consolidated total leverage ratio (defined as the ratio of (a) consolidated funded indebtedness as of such date less cash that is not subject to any restriction on the use or investment thereof to (b) consolidated EBITDA (as defined by the amended Seventh Amended and Restated Credit Agreement (the "Credit Agreement")), for the period of four consecutive fiscal quarters ending on such date).

The Company will pay an annual commitment fee (ranging from 0.15 % to 0.30 %), based on the Company's consolidated total leverage ratio, on the amount available for borrowing under the revolving credit facility.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Senior Credit Facility is collateralized by substantially all of the assets of the Company’s U.S.

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The Senior Credit Facility is subject to various financial and negative covenants and at December 31, 2023, the Company was in compliance with all such covenants.

In connection with the February 2020 Amendment, the Company capitalized $ 4.6 million of financing costs in connection with modification of the Senior Credit Facility and wrote off $ 1.2 million of previously capitalized financing costs during the first quarter of 2020.

In connection with the July 2020 amendment, the Company expensed $ 3.3 million of incremental financing costs in connection with the modification of the Senior Credit Facility during the third quarter of 2020.

There was no balance outstanding at December 31, 2022 under the revolving portion of the Senior Credit Facility and as of December 31, 2021, there was $ 31.3 million, outstanding under the revolving portion of the Senior Credit Facility at weighted average interest rate of 1.4 %.

At December 31, 2022 and 2021, there was $ 771.3 million and $ 843.8 million, respectively, outstanding, under the Term Loan component of the Senior Credit Facility at weighted average interest rate of 5.6 % and 1.4 % , respectively.

The Company capitalized $ 7.6 million deferred financing costs in connection with the modification of the Senior Credit Facility and wrote off $ 0.2 million of previously capitalized financing costs during the year ended 2023.

There was $ 70.0 million outstanding at December 31, 2023 under the revolving portion of the Senior Credit Facility at a weighted average interest rate of 6.8 %.

As of December 31, 2022 , there was no balance outstanding under the revolving portion of the Senior Credit Facility.

At December 31, 2023 and 2022, there was $ 775.0 million outstanding under the Term Loan component of the Senior Credit Facility at weighted average interest rate of 6.8 % and 5.6 % , respectively.

At December 31, 2023 and 2022, there was $ 14.5 million and $ 38.1 million, respectively, of the Term Loan component of the Senior Credit Facility was classified as current on the consolidated balance sheets.

3 unchanged sentences

Level 2 inputs represent inputs that are observable for the asset or liability, either directly or indirectly, and are other than active market observable inputs that reflect unadjusted quoted prices for identical assets or liabilities

Letters of credit outstanding as of December 31, 2022 and 2021 totaled $ 1.6 million.

Letters of credit outstanding as of December 31, 2023 and 2022 totaled $ 1.7 million, and $ 1.6 million respectively.

Ther e were no amounts drawn as of December 31, 2023.

5 unchanged sentences

2026 $ 38,750

Future interest payments on the term loan component of the Senior Credit Facility based on current interest rates are expected to approximate $ 42.7 million in 2023, $ 39.1 million in 2024, and $ 3.6 million in 2025.

Interest is calculated on the term loan portion of the Senior Credit Facility based on LIBOR plus the spread paid by the Company.

As the revolving credit facility and Securitization Facility can be repaid at any time, no interest has been included in the calculation.

The outstanding balance of the revolving credit component of the Senior Credit Facility is due on February 3, 2025.

Thereafter $ 687,813

Future interest payments on the term loan component of the Senior Credit Facility based on current interest rates are expected to approximate $ 52.4 million in 2024, $ 50.5 million in 2025, $ 47.9 million in 2026, and $ 54.7 million thereafter.

Interest is calculated on the term loan portion of the Senior Credit Facility based on SOFR plus the certain amounts set forth in the Credit Agreement.

As the revolving credit facility and Securitization Facility (defined below) can be repaid at any time, no interest has been included in the calculation.

Any outstanding borrowings on the revolving credit component of the Senior Credit Facility is due on March 24, 2028.

Convertible Senior Notes

1 unchanged sentence

The 2025 Notes will mature on August 15, 2025 and bear interest at a rate of 0.5 % per annum payable semi-annually in arrears, unless earlier converted, repurchased or redeemed in accordance with the terms of the 2025 Notes.

The portion of debt proceeds that was classified as equity at the time of the offering was $ 104.5 million.

The effective interest rate implicit in the liability component was 4.2 %.

In connection with this offering, the Company capitalized $ 13.2 million of financing fees.

The 2025 Notes are senior, unsecured obligations of the Company, and are convertible into cash and shares of its common stock based on initial conversion rate, subject to adjustment of 13.5739 shares per $1,000 principal amounts of the 2025 Notes (which represents an initial conversion price of $ 73.67 per share).

2 unchanged sentences

(2) if the average trading price per $1,000 principal amount of the 2025 Notes is less than or equal to 98 % of the average conversion value of the 2025 Notes during a period as defined in the indenture;

(3) at any time on or after February 20, 2023;

(3) if the Company calls the notes for optional redemption as defined in the indenture;

or (4) if specified corporate transactions occur.

As of December 31, 2023, none of these conditions existed with respect to the 2025 Notes and as a result the 2025 Notes are classified as long term.

On December 9, 2020, the Company entered into the First Supplemental Indenture to the original agreement dated as of February 4, 2020 between the Company and Citibank, N.A., as trustee, governing the Company’s outstanding 2025 Notes.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company irrevocably elected (1) to eliminate the Company’s option to choose physical settlement on any conversion of the 2025 Notes that occurs on or after the date of the First Supplemental Indenture and (2) with respect to any Combination Settlement for a conversion of the 2025 Notes, the Specified Dollar Amount that will be settled in cash per $1,000 principal amount of the 2025 Notes shall be no lower than $ 1,000 .

Settlement for a conversion of the 2025 Notes, the Specified Dollar Amount that will be settled in cash per $1,000 principal amount of the 2025 Notes shall be no lower than $ 1,000 .

Holders of the Notes will have the right to require the Company to repurchase for cash all or a portion of their Notes at 100 % of their principal amount, plus any accrued and unpaid interest, upon the occurrence of a fundamental change (as defined in the indenture relating to the Notes).

10 unchanged sentences

The level of the 2025 Notes is considered as Level 1.

As a result of the adoption of ASU 2020-06, for both the years ended December 31, 2022 and 2021, the Company recognized only cash interest related to the contractual interest coupon on the 2025 Notes of $ 2.9 million.

Securitization Facility

On December 15, 2023, the Company entered into an amendment (the "December 2023 Amendment") of the Securitization Facility which extended the maturity date from May 28, 2024 to December 15, 2026.

The company incurred approximately $ 0.3 million of new issuance costs associated with the amendment which will be amortized over 3 years, the length of the agreement.

Due to the increase in borrowing capacity, the remaining $ 0.1 million of unamortized costs from the previous agreement will be amortized over the length of the amended agreement, 3 years.

In addition, on April 17, 2023 the company entered into an amendment (the "April 2023 Amendment") of the Securitization Facility and amended the interest rate from LIBOR to SOFR indexed rate.

The December 2023 and April 2023 Amendments do not increase the Company’s total indebtedness.

During the fourth quarter of 2018, the Company entered into an accounts receivable securitization facility (the "Securitization Facility") under which accounts receivable of certain domestic subsidiaries are sold on a non-recourse basis to a special purpose entity (“SPE”), which is a bankruptcy-remote, consolidated subsidiary of the Company.

5 unchanged sentences

As of December 31, 2023, the Company was in compliance with the covenants and none of the termination events had occurred.

On May 28, 2021, the Company entered into an amendment (the "May 2021 Amendment") of the Securitization Facility which extended the maturity date from December 21, 2021 to May 28, 2024.

The May 2021 Amendment does not increase the Company’s total indebtedness.

At December 31, 2023 and 2022, the Company had $ 89.2 million and $ 104.7 million, of outstanding borrowings under its Securitization Facility at a weighted average interest rate of 5.9 % and 5.0 %, respectively.

10 unchanged sentences

The Company uses interest rate swap derivative instruments to manage earnings and cash flow exposure resulting from changes in interest rates.

These interest rate swaps apply a fixed interest rate on a portion of the Company's expected LIBOR-indexed floating-rate borrowings.

These interest rate swaps apply a fixed interest rate on a portion of the Company's expected SOFR-indexed borrowings.

In connection with the March 2023 Amendment to the Senior Credit Facility, the Company amended its interest rate from LIBOR to SOFR-indexed interest.

In March 2023, the Company entered into a basis swap where the Company receives Term SOFR and pays daily compounded SOFR to convert the portfolio of swaps from daily compounded SOFR to term SOFR.

The Company held the following interest rate swaps as of December 31, 2023 and 2022 (dollar amounts in thousands):

December 31, 2022 December 31, 2021 December 31, 2022 December 31, 2021

December 31, 2023 December 31, 2023

Hedged Item Notional Amount Designation Date Effective Date Termination Date Fixed Interest Rate Estimated Fair Value

Asset (Liability)

1-month USD LIBOR Loan — 300,000 December 13, 2017 January 1, 2018 December 31, 2022 2.201 % $ — $ ( 5,268 )

1-month Term SOFR Loan 150,000 December 13, 2017 July 1, 2019 June 30, 2024 2.423 % 2,105

1-month Term SOFR Loan 200,000 December 13, 2017 January 1, 2018 December 31, 2024 2.313 % 4,978

1-month Term SOFR Loan 75,000 October 10, 2018 July 1, 2020 June 30, 2025 3.220 % 1,349

1-month Term SOFR Loan 75,000 October 10, 2018 July 1, 2020 June 30, 2025 3.199 % 1,312

1-month Term SOFR Loan 75,000 October 10, 2018 July 1, 2020 June 30, 2025 3.209 % 1,346

1-month Term SOFR Loan 100,000 December 18, 2018 December 30, 2022 December 31, 2027 2.885 % 3,015

1-month Term SOFR Loan 100,000 December 18, 2018 December 30, 2022 December 31, 2027 2.867 % 3,052

1-month Term SOFR Loan 575,000 December 15, 2020 July 31, 2025 December 31, 2027 1.415 % 22,965

1-month Term SOFR Loan 125,000 December 15, 2020 July 1, 2025 December 31, 2027 1.404 % 5,263

Basis Swap (1)

— March 31, 2023 March 24, 2023 December 31, 2027 N/A ( 1,829 )

$ 1,475,000 $ 43,556

(1) The notional of the basis swap amortizes to match the total notional of the interest rate swap portfolio over time

December 31, 2022 December 31, 2022

Hedged Item Notional Amount Designation Date Effective Date Termination Date Fixed Interest Rate Estimated Fair Value

Asset (Liability)

1-month USD LIBOR Loan 150,000 December 13, 2017 July 1, 2019 June 30, 2024 2.423 % 5,012

8 unchanged sentences

$ 1,475,000 $ 56,712

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The interest rate swaps were carried on the consolidated balance sheet at fair value and changes in the fair values were recorded as unrealized gains or losses in accumulated other comprehensive income (“AOCI”).

For the years ended December 31, 2023 and 2022, the Company recorded gains of $ 4.9 million and $ 93.3 million, respectively, in AOCI related to the change in fair value of the interest rate swaps.

For the years ended December 31, 2023 and 2022, the Company recorded a gain of $ 18.1 million and a loss of $ 7.4 million, respectively, in interest income included in the consolidated statements of operations related to the interest rate differential of the interest rate swaps.

The estimated gain that is expected to be reclassified to interest income from AOCI as of December 31, 2023 within the next twelve months is $ 14.1 million.

The Company has designated these derivative instruments as cash flow hedges.

The Company assesses the effectiveness of these derivative instruments and has recorded the changes in the fair value of the derivative instrument designated as a cash flow hedge as unrealized gains or losses in accumulated other comprehensive income (“AOCI”), net of tax, until the hedged item affected earnings, at which point any gain or loss was reclassified to earnings.

The Company assesses the effectiveness of these derivative instruments and has recorded the changes in the fair value of the derivative instrument designated as a cash flow hedge as unrealized gains or losses in AOCI, net of tax, until the hedged item affected earnings, at which point any gain or loss was reclassified to earnings.

If the hedged cash flow does not occur, or if it becomes probable that it will not occur, the Company will reclassify the remaining amount of any gain or loss on the related cash flow hedge recorded in AOCI to interest expense at that time.

11 unchanged sentences

Cross-Currency Rate Swaps

On October 2, 2017, the Company entered into cross currency swap agreements to convert a notional amount of $ 300.0 million equivalent to 291.2 million of Swiss Francs ("CHF") denominated intercompany loans into U.S.

The CHF- denominated intercompany loans were the result of the purchase of intellectual property by a subsidiary in Switzerland as part of an acquisition.

On September 26, 2022, the Company amended the CHF-denominated intercompany loan to extend the termination date to September 2023 and as a result, the Company early terminated the cross-currency swap designated as cash flow hedge of an intercompany loan with aggregate notional amount of $ 50.0 million.

Simultaneously, the Company entered into a cross-currency swap agreement to convert a notional amount of CHF 48.5 million equivalent to $ 49.1 million of this

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

amended intercompany loan into U.S.

The objective of these cross-currency swaps is to reduce volatility of earnings and cash flows associated with changes in the foreign currency exchange rate.

Under the terms of these contracts, which have been designated as cash flow hedges, the Company will make interest payments in Swiss Francs and receive interest in U.S.

Upon the maturity of these contracts, the Company will pay the principal amount of the loans in Swiss Francs and receive U.S.

dollars from the counterparties.

On September 22, 2023, the Company amended the Swiss Franc ("CHF")-denominated intercompany loan to partially settle CHF 20.0 million and extend the termination date to September 2024 and as a result, the Company terminated the cross-currency swap designated as cash flow hedge of an intercompany loan with aggregate notional amount of $ 48.5 million.

Simultaneously, the Company entered into a cross-currency swap agreement to hedge a notional amount of CHF 28.5 million equivalent to $ 31.5 million of this amended intercompany loan into U.S.

The loss recorded by the Company upon the settlement of the swap was not material for the period.

As of December 31, 2022, $ 49.1 million of the $ 300.0 million notional amount remain outstanding.

On December 21, 2020, the Company entered into cross-currency swap agreements to convert a notional amount of $ 471.6 million equivalent to 420.1 million of a CHF-denominated intercompany loan into U.S.

2 unchanged sentences

As a result, the aggregate notional amount of the related cross-currency swaps will decrease by a corresponding amount.

The objective of these cross-currency swaps is to reduce volatility of earnings and cash flows associated with changes in the foreign currency exchange rate.

Under the terms of these contracts, which have been designated as cash flow hedges, the Company will make interest payments in Swiss Francs and receive interest in U.S.

Upon the maturity of these contracts, the Company will pay the principal amount of the loans in Swiss Francs and receive U.S.

dollars from the counterparties.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company held the following cross-currency rate swaps as of December 31, 2023 and 2022 (dollar amounts in thousands):

December 31, 2023 December 31, 2022 December 31, 2023 December 31, 2022

Effective Date Termination Date Fixed Rate Aggregate Notional Amount Fair Value Asset (Liability)

Pay CHF October 2, 2017 October 2, 2022 1.95 % CHF — 145,598 — ( 8,283 )

Receive U.S.$ 4.52 % $ — 150,000

Effective Date Termination Date Fixed Rate Aggregate Notional Amount Fair Value

Asset (Liability)

Pay CHF December 21, 2020 December 22, 2025 3.00 % CHF 351,137 374,137 ( 38,324 ) ( 4,241 )

2 unchanged sentences

Receive U.S.$ 5.32 % $ — 49,142

Pay CHF September 22, 2023 September 29, 2024 2.40 % CHF 28,500 — ( 2,348 ) —

Receive U.S.$ 6.27 % $ 31,457 —

Total $ ( 40,672 ) $ ( 7,769 )

On October 3 rd , 2022, in accordance with the termination date, the Company settled cross-currency swaps designated as cash flow hedges of an intercompany loan with aggregate notional amounts of $ 100 million.

Based on the closing exchange rates, the gain upon settlement of these swaps was approximately $ 1.6 million which was offset by the loss on the settlement of the intercompany loan.

On October 4, 2021 in accordance with the termination date, the Company settled a cross-currency swap designated as a cash flow hedge of an intercompany loan with an aggregate notional amount of $ 50.0 million.

The gain recorded by the Company upon the settlement of the swap was not material for the period.

The cross-currency swaps are carried on the consolidated balance sheet at fair value, and changes in the fair values are recorded as unrealized gains or losses in AOCI.

For the years ended December 31, 2023 and 2022 the Company recorded a loss of $ 37.4 million and a gain of $ 11.1 million, respectively, in other income, net related to change in fair value related to the foreign currency rate translation to offset the losses recognized on the intercompany loans.

For the years ended December 31, 2023 and 2022, the Company recorded a loss of $ 27.4 million and a gain of $ 8.8 million in AOCI, respectively, related to change in fair value of the cross-currency swaps.

For the years ended December 31, 2023 and 2022, the Company recorded gains of $ 5.5 million and $ 8.4 million, respectively, in other income, net included in the consolidated statements of operations related to the interest rate differential of the cross-currency swaps.

The estimated loss that is expected to be reclassified to other income (expense), net from AOCI as of December 31, 2023 within the next twelve months is $ 4.3 million.

As of December 31, 2023, the Company does not expect any gains or losses will be reclassified into earnings because the original forecasted transactions will not occur.

Net Investment Hedges

1 unchanged sentence

The Company is exposed to foreign exchange risk from its international operations through foreign currency purchases, net investments in foreign subsidiaries, and foreign currency assets and liabilities created in the normal course of business.

On October 1, 2018 ,December 16, 2020 and May 26, 2022, the Company entered into cross-currency swap agreements designated as net investment hedges to partially offset the effects of foreign currency on foreign subsidiaries.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

8 unchanged sentences

Receive U.S.$ 2.19 % $ 45,000 45,000

Pay CHF December 16, 2020 December 16, 2027 — % CHF — 222,300 — ( 792 )

Receive USD 1.10 % $ — 250,000

Pay CHF May 26, 2022 December 16, 2028 — % CHF 288,210 288,210 ( 48,047 ) ( 14,663 )

Receive U.S.$ 1.94 % $ 300,000 300,000

Pay CHF November 21, 2023 December 17, 2029 — % CHF 66,525 — ( 4,037 ) —

Receive U.S.$ 2.54 % $ 75,000 —

Total $ ( 49,609 ) $ ( 5,643 )

On May 26, 2022, the Company early settled cross-currency swaps designated as net investment hedge with an aggregate notional amount of $ 250 million equivalent to 222.3 million CHF.

The original settlement date was December 16, 2027.

As a result of the settlement, the Company recorded a gain of $ 4.9 million in AOCI.

On May 26, 2022, the Company entered into cross-currency swap agreements designated as net investment hedge to replace these swaps with a notional amount of $ 300 million equivalent to 288 million CHF.

On September 30, 2021, in accordance with the termination date, the Company settled cross-currency swaps designated as net investment hedge with an aggregate notional amount of $ 52 million equivalent to 44.9 million Euros.

As a result of the settlement, the Company recorded a gain of $ 0.1 million in AOCI.

The cross-currency swaps were carried on the consolidated balance sheet at fair value and changes in the fair values were recorded as unrealized gains or losses in AOCI.

For the years ended December 31, 2023 and 2022, the Company recorded a loss of $ 30.7 million and a gain of $ 2.2 million, respectively, in AOCI related to the change in fair value of the cross-currency swaps.

For the years ended December 31, 2023 and 2022, the Company recorded gains of $ 7.8 million and $ 6.8 million, respectively, in interest income included in the consolidated statements of operations related to the interest rate differential of the cross-currency swaps.

The estimated gain that is expected to be reclassified to interest income from AOCI as of December 31, 2023 within the next twelve months is immaterial .

Foreign Currency Forward Contract

The Company has entered into a hedge for forecasted intercompany purchases denominated in foreign currencies through the use of forward contracts designated as cash flow hedges.

To the extent these forward contracts meet hedge accounting criteria, changes in their fair value are included in AOCI.

These changes in fair value will be recognized into earnings as a component of cost of sales when the forecasted-transaction occurs.

During 2023, the Company entered into foreign currency forward contracts to mitigate the risk of foreign currency on intercompany purchases in CHF.

These contracts typically settle at various dates within twelve months of execution.

As of December 31, 2023 there were no outstanding foreign currency forward contracts.

During the year ended December 31, 2023 the Company recorded a gain of $ 0.4 million in AOCI related to the change in fair value of the foreign currency forward contracts.

During the year ended December 31, 2023 the company recorded a gain of $ 0.4 million in cost of goods sold included in the consolidated statements of operations related to the foreign currency forward contracts.

Counterparty Credit Risk

16 unchanged sentences

Cash Flow Hedges

Cross-currency swap 4,497 4,900

Interest rate swap (2)

14,675 16,682

Cross-currency swap 537 4,497

Net Investment Hedges

2 unchanged sentences

Interest rate swap (2)

30,710 40,030

Net Investment Hedges

16 unchanged sentences

(1) The Company classifies derivative assets and liabilities as current based on the cash flows expected to be incurred within the following 12 months.

(2) At December 31, 2022 and 2021, the total notional amounts related to the Company’s interest rate swaps were $ 1.5 billion and $ 1.8 billion respectively.

(2) At December 31, 2023 and 2022, the total notional amounts related to the Company’s interest rate swaps were $ 1.5 billion.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

13 unchanged sentences

Cross-currency swap ( 20,271 ) ( 27,406 ) ( 31,914 ) ( 15,763 ) Other income, net

Forward Currency Forward Contracts — 436 436 — Cost of sales

Net Investment Hedges

8 unchanged sentences

$ ( 55,965 ) $ 104,351 $ 18,859 $ 29,527

For the years ended December 31, 2022 and 2021, the Company recorded a gain of $ 11.1 million and gain of $ 23.8 million , respectively, in other income, net related to change in fair value related to the foreign currency rate tran slation of the cross-currency swaps, designated as cash flow hedges, to offset the gains or losses recognized on the intercompany loans.

For the years ended December 31, 2022 and 2021, the Company reco rded gains of $ 8.4 million an d $ 9.1 million, respectively, in other income, net included in the consolidated statements of operations related to the interest rate differential of the cross-currency swaps designated as cash flow hedges.

The estimated gain that is expected to be reclassified to other income, net from AOCI as of December 31, 2022, for the cross-currency swaps designated as cash flow hedges within the next twelve months is $ 4.5 million.

As of December 31, 2022, the Company does not expect any gains or losses will be reclassified into earnings as a result of the discontinuance of these cash flow hedges because the original forecasted transaction will not occur.

The estimated gain that is expected to be reclassified to interest income from AOCI as of December 31, 2022 for the c ross-currency swaps designated as net investment hedges, within the next twelve months is $ 11.7 million.

Derivative Instruments not designated hedges:

During the fourth quarter of 2020, the Company entered into foreign currency forward contracts, with a notional amount of $ 4.2 million, to mitigate the foreign exchange risk related to certain intercompany loans denominated in Canadian Dollar ("CAD").

These contracts were settled in third quarter of 2022.

During the second quarter of 2021, the Company entered into a foreign currency swap, with a notional amount of $ 7.3 million, to mitigate the risk from fluctuations in foreign currency exchange rates associated with an intercompany loan denominated in JPY.

1 unchanged sentence

The notional amount of each currency is exchanged at the inception and termination of the currency swap by each party.

The Company subsequently paid down a portion of this swap, bringing the notional amount down to $ 6.4 million.

The following table summarizes the gains (losses) of derivative instruments not designated as hedges on the condensed consolidated statements of income, which was included in other income:

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company subsequently paid down a portion of this swap in the second quarter of 2023, bringing the notional amount down to $ 5.5 million as of December 31, 2023.

The following table summarizes the gains (losses) of derivative instruments not designated as hedges on the consolidated statements of income, which was included in other income:

Dollars in thousands December 31,

Foreign currency forward contracts $ — $ ( 174 )

Foreign currency swaps 566 1,258

6 unchanged sentences

The quantitative test estimates the fair value of the three reporting units using a discounted cash flow model, which incorporates significant estimates and assumptions made by management which, by their nature, are characterized by uncertainty.

Inputs used to fair value the Company's reporting units are considered inputs of the fair value hierarchy.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

used to fair value the Company's reporting units are considered inputs of the fair value hierarchy.

For Level 3 measurements, significant increases or decreases in long-term growth rates or discount rates in isolation or in combination could result in a significantly lower or higher fair value measurement.

5 unchanged sentences

The weighted-average cost of capital is the Company's estimate of the overall after-tax rate of return required by equity and debt holders of a business enterprise.

In the second quarter of 2023, due to the Boston recall, as well as the associated drop in the Company's stock price in that quarter, the Company elected to perform a quantitative analysis, using a combination of a discounted cash flow method and guideline public company method for its TT reporting unit.

The quantitative test utilized key assumptions of revenue growth rate, a terminal growth rate of 2 %, a discount rate of 10 %, and the range and application of the company guideline multiples.

The Company determined, after performing the quantitative analysis, that the fair value of the goodwill of the reporting unit was not less than the carrying amount, with more than 20 % headroom.

During the third quarter of 2023, the Company elected to perform a qualitative analysis for its three reporting units.

3 unchanged sentences

Goodwill at January 1, 2022

ACell Acquisition — 94,147 94,147

$ 663,428 $ 350,030 $ 1,013,458

Sale of non-core traditional wound care business — ( 5,019 ) ( 5,019 )

SIA Acquisition — 41,855 41,855

Foreign currency translation ( 7,209 ) ( 4,204 ) ( 11,413 )

Balance at December 31, 2022

$ 656,219 $ 382,662 $ 1,038,881

Sale of non-core traditional wound care business — — —

2 unchanged sentences

Balance at December 31, 2023

$ 666,937 $ 388,525 $ 1,055,462

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

41 unchanged sentences

The Company determined, after performing the qualitative analysis, that there was no evidence that it is more likely than not that the fair value was less that the carrying amounts, therefore, it was not necessary to perform a quantitative impairment test.

Intangible Assets with Definite Lives

Product rights and other definite-lived intangible assets are tested periodically for impairment in accordance with ASC Topic 360 when events or changes in circumstances indicate that an asset's carrying value may not be recoverable.

3 unchanged sentences

The computed impairment loss is recognized in the period that the impairment occurs.

Amortization expense (including amounts reported in cost of product revenues) for the years ended December 31, 2022, 2021 and 2020 was $ 78.3 million, $ 83.3 million and $ 74.5 million, respectively.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

In the second quarter of 2023, due to the Boston recall, the Company elected to perform impairment testing on certain definite lived intangibles.

The intangible components associated with the recalled products include completed technology and customer relationships with a net book value of $ 28.8 million and $ 7.6 million, respectively, as of December 31, 2023.

The company used an undiscounted cash flow methodology and obtained revenue projections through the useful life of the intangibles.

After performing the analysis, no impairment was noted.

The Company will continue to monitor these intangibles as we return to the market and evaluate any changes that would impact our sales of these products.

Amortization expense (including amounts reported in cost of product revenues) for the years ended December 31, 2023, 2022 and 2021 was $ 82.8 million, $ 78.3 million and $ 83.3 million, respectively.

Annual amortization expense is expected to approximate $ 82.7 million in 2024, $ 82.7 million in 2025, $ 82.5 million in 2026, $ 80.6 million in 2027, $ 79.0 million in 2028 and $ 481.2 million thereafter.

2 unchanged sentences

As of December 31, 2023 and 2022, there were 12.8 million and 6.8 million shares of treasury stock outstanding with a cost of $ 647.3 million and $ 362.9 million, respectively, at a weighted average cost per share of $ 50.76 and $ 53.18 , respectively.

On January 26, 2023, the Company entered into a $ 150 million accelerated share repurchase ("2023 ASR") and received 2.1 million shares of the Company common stock at inception of the 2023 ASR, which represented approximately 80 % of the expected total shares of under the 2023 SAR.

The remaining repurchase transactions are expected to be completed in the first half of 2023.

On April 26 2022, the Board of Directors authorized the Company to repurchase up to $ 225 million of the Company’s common stock.

The program allows the Company to repurchase its shares opportunistically from time to time.

The repurchase authorization expires in December 2024.

This stock repurchase authorization replaces the previous $ 225 million stock repurchase authorization, of which $ 100 million remained authorized at the time of its replacement, and which was otherwise set to expire on December 31, 2022.

Purchases may be affected through one or more open market transactions, privately negotiated transactions, transactions structured through investment banking institutions, or a combination of the foregoing.

On August 15, 2023, the Company entered into a $ 125 million accelerated share repurchase ("August 2023 ASR") and received 2.3 million shares of the common stock at inception of the August 2023 ASR, which represented approximately 80 % of the expected total shares under the August 2023 ASR.

On October 18, 2023 the early exercise provision was exercised by the August 2023 ASR counterparty.

The Company received an additional 0.9 million shares determined using the volume-weighted average price of the Company's common stock during the term of the August 2023 ASR.

On January 26, 2023, the Company entered into a $ 150 million accelerated share repurchase ("January 2023 ASR") and received 2.1 million shares of common stock at inception of the January 2023 ASR, which represented approximately 80 % of the expected total shares under the January 2023 ASR.

The settlement of the January ASR agreement was completed in two separate transactions on April 26, 2023 and May 4, 2023, where the Company received an additional 0.30 million and 0.31 million shares respectively, determined using the volume-weighted average price of the Company's common stock during the term of the January 2023 ASR.

On August 16, 2022, the Inflation Reduction Act of 2022 (the “Act”) was signed into law.

The Act implemented a new excise tax of 1% on the net share repurchases made by the Company effective for share repurchases performed January 1, 2023, or after.

The Company accrued $ 2.5 million of excise tax related to the two ASR agreements during 2023.

On July 18, 2023, the Board of Directors authorized a new $ 225 million share repurchase program, replacing the existing $ 225 million program authorized in April 2022.

A s of December 31, 2023, $ 100 million remained authorized .

The program authorized in July 2023, and which expires on December 31, 2025, allows the Company to repurchase its shares opportunistically from time to time.

The Company may utilize various methods to effect any repurchases, including open market transactions, privately negotiated transactions, transactions structured through investment banking institutions, including accelerated share repurchases, or a combination of the foregoing, some of which may be effected through Rule 10b5-1 plans.

The price and timing of any future purchases under the share repurchase program will depend on factors such as levels of cash generation from operations, the volume of stock option exercises by employees, cash requirements for acquisitions, dividends, economic and market conditions and stock price, and such repurchases may be discontinued at any time.

On January 12, 2022, the Company entered into a $ 125 million accelerated share repurchase ("2022 ASR") and received 1.48 million shares of Company common stock at inception of the 2022 ASR, which represented approximately 80 % of the expected total shares under the 2022 ASR.

1 unchanged sentence

Upon settlement on March 24, 2022, the Company received an additional 0.46 million shares determined using the volume-weighted average price of the Company's common stock during the term of the 2022 ASR.

For the year ended December 31, 2021, there were no repurchases of the Company’s common stock as part of the share repurchase authorization.

On August 16, 2022, the Inflation Reduction Act of 2022 (the “Act”) was signed into law.

The Act implements a new excise tax of 1% on the net share repurchases made by the company effective for share repurchases performed January 1, 2023, or after.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

STOCK-BASED COMPENSATION

8 unchanged sentences

Net effect on net income $ 14,919 $ 17,151 $ 22,406

EMPLOYEE STOCK PURCHASE PLAN

The purpose of the Employee Stock Purchase Plan (the “ESPP”) is to provide eligible employees of the Company with the opportunity to acquire shares of common stock at periodic intervals by means of accumulated payroll deductions.

The ESPP is a non-compensatory plan.

Under the ESPP, a total of 3.0 million shares of common stock are reserved for issuance.

These shares will be made available either from the Company’s authorized but unissued shares of common stock or from shares of common stock reacquired by the Company as treasury stock.

At December 31, 2022, 2.0 million shares remain available for purchase under the ESPP.

During the years ended December 31, 2022, 2021 and 2020, the Company issued 20,780 shares, 16,948 shares and 18,284 shares under the ESPP for $ 1.1 million, $ 1.1 million and $ 1.1 million, respectively.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

EQUITY AWARD PLANS

5 unchanged sentences

Stock options issued under the 2003 Plan became exercisable over specified periods, generally within four years from the date of grant for officers and employees, and within one year from the date of the grant for members of the Board of Directors.

The awards generally expire eight years from the grant date for employees and from six to ten for directors and certain executive officers, except in certain instances that result in accelerated vesting due to death, disability, retirement age or change in control provisions within their grant agreements.

The awards generally expire eight years from the grant date for employees and from six to ten years for directors and certain executive officers, except in certain instances that result in accelerated vesting due to death, disability, retirement age or change in control provisions within their grant agreements.

Restricted stock issued under the 2003 Plan vests ratably over specified periods, generally three years after the date of grant.

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The Company accounts for forfeitures as they occur.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following weighted-average assumptions were used in the calculation of fair value:

11 unchanged sentences

Outstanding at January 1, 2023

1,202 $ 49.63 4.14 $ 10,772

Granted 151 52.87 — —

2 unchanged sentences

Outstanding at December 31, 2023

1,178 $ 50.64 3.65 $ 1,766

Exercisable at December 31, 2023

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

888 $ 48.43 2.75 $ 1,762

The Company recognized $ 1.4 million, $ 3.5 million and $ 5.0 million in expense related to stock options during the years ended December 31, 2023, 2022 and 2021, respectively.

1 unchanged sentence

Cash received from option exercises and employee stock purchase plan was $ 4.3 million, $ 5.5 million and $ 6.8 million, for the years ended December 31, 2023, 2022 and 2021, respectively.

The realized tax benefit from options exercised w ere $ 0.6 mi llion, $ 2.2 million and $ 1.7 million for the years ended December 31, 2022, 2021 and 2020, respectively.

The realized tax benefit from options exercised were $ 0.1 million, $ 0.6 million and $ 2.2 million for the years ended December 31, 2023, 2022 and 2021, respectively.

As of December 31, 2023, there was approximately $ 3.8 million of total unrecognized compensation costs related to unvested stock options.

These costs are expected to be recognized over a weighted-average period of approximately two years .

These costs are expected to be recognized over a weighted-average period of approximately three years .

Awards of Restricted Stock, Performance Stock and Contract Stock

4 unchanged sentences

Unvested, January 1, 2023

483 $ 61.63 407 62.88

Granted 411 51.01 229 52.29

4 unchanged sentences

Unvested, December 31, 2023

584 $ 55.37 335 57.53

The Company recognized $ 18.7 million, $ 24.3 million and $ 31.2 million in expense related to such awards during the years ended December 31, 2023, 2022 and 2021, respectively.

The total fair market value of shares vested and released in 2022, 2021 and 2020 was $ 65.0 million, $ 15.7 million and $ 17.3 million, respectively.

The total fair market value of shares vested and released in 2023, 2022

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

and 2021 was $ 18.2 million, $ 65.0 million and $ 15.7 million, respectively.

Vested awards include shares that have been fully earned but had not been delivered as of December 31, 2023.

2 unchanged sentences

The fair value of these awards is being expensed on a straight-line basis over the vesting period.

As of December 31, 2022, there were 129,399 performance stock units ("PSU's") subject to vest and be released based on 2022 performance achievement.

As of December 31, 2023, there were 51,241 performance stock units ("PSU's") granted in 2021 subject to vest and be released in 2024 based on PSU catch-up opportunity.

No additional PSU's were subject to vest based on 2023 performance achievement.

As of December 31, 2023, there was approximately $ 30.5 million of total unrecognized compensation costs related to unvested restricted stock, performance stock and contract stock awards.

3 unchanged sentences

Such share-based compensation was recognized as cost of goods sold when related inventory was sold.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

EMPLOYEE STOCK PURCHASE PLAN

The ESPP is a non-compensatory plan.

Under the ESPP, a total of 3.0 million shares of common stock are reserved for issuance.

These shares will be made available either from the Company’s authorized but unissued shares of common stock or from shares of common stock reacquired by the Company as treasury stock.

At December 31, 2023, 1.9 million shares remain available for purchase under the ESPP.

During the years ended December 31, 2023, 2022 and 2021, the Company issued 23,337 shares, 20,780 shares and 16,948 shares under the ESPP for $ 1.0 million, $ 1.1 million and $ 1.1 million, respectively.

RETIREMENT BENEFIT PLANS

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The resulting discount rates are consistent with the duration of plan liabilities.

In 2022 and 2021, the discount rates were prescribed as the current yield on corporate bonds with an average rating of AA or AAA of equivalent currency and term to the liabilities.

In 2023 and 2022, the

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

discount rates were prescribed as the current yield on corporate bonds with an average rating of AA or AAA of equivalent currency and term to the liabilities.

The expected returns on plan assets represent the average rate of return expected to be earned on plan assets over the period the benefits included in the benefit obligation are to be paid.

2 unchanged sentences

The assessment is determined using projections from external financial sources, long-term historical averages, actual returns by asset class and the various asset class allocations by market.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following sets forth the change in projected benefit obligations and the change in plan assets for the years ended December 31, 2023 and 2022 and a reconciliation of the funded status at December 31, 2023 and 2022, respectively (amounts in thousands):

29 unchanged sentences

The unfunded benefit obligations are included in other liabilities in the consolidated balance sheets at December 31, 2023 and 2022, respectively.

During the periods ended December 31, 2022 and 2021 , the Company had a net gain of $ 7.4 million and $ 7.0 million, respectively, recognized within accumulated other comprehensive loss that has not been recognized as a component of net periodic benefit cost.

The gain recognized during the period ended December 31, 2021, is primarily attributed to a change in the discount rate used to estimate the projected benefit obligation for defined benefit plans which cover certain employees in Switzerland.

During the periods ended December 31, 2023 and 2022 , the Company had a net loss of $ 6.6 million and a net gain of $ 7.4 million, respectively, recognized within accumulated other comprehensive loss that has not been recognized as a component of net periodic benefit cost.

The combined accumulated benefit obligations for the defined benefit plans was $ 62.8 million and $ 46.4 million as of December 31, 2023 and 2022, respectively.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Unrecognized gains and losses are amortized over the average remaining future service for each plan.

3 unchanged sentences

Prior service costs/benefits for the pension plans are amortized over the average remaining future service of plan participants at the time of the plan amendment.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The net plan assets of the pension plans are invested in common trusts.

31 unchanged sentences

Supplemental balance sheet information related to operating leases at December 31, 2023 were as follows:

December 31, 2022

December 31, 2021

December 31, 2023 December 31, 2022

(In thousands, except lease term and discount rate)

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Supplemental cash flow information related to leases was as follows:

December 31, 2022

December 31, 2021

December 31, 2023 December 31, 2022

(In thousands)

21 unchanged sentences

Related Party Leases

The Company leases its manufacturing facility in Plainsboro, New Jersey, from a general partnership that is 50 % owned by a corporation whose stockholders are trusts, whose beneficiaries include family members of the Company’s principal stockholder and former director.

The term of the current lease agreement is through October 31, 2029 at an annual rate of approximately $ 0.3 million per year.

The Company leases its manufacturing facility in Plainsboro, New Jersey, from a general partnership that is 50 % owned by a principal stockholder of the Company.

The term of the current lease agreement is through October 31, 2029 at an annual rate of approximately $ 0.3 million.

The current lease agreement also provides (i) a 5-year renewal option for the Company to extend the lease from November 1, 2029 through October 31, 2034 at the fair market rental rate of the premises, and (ii) another 5-year renewal option to extend the lease from November 1, 2034 through October 31, 2039 at the fair market rental rate of the premises.

12 unchanged sentences

State income taxes, net of federal tax benefit 2.9 % 0.1 % 1.9 %

Foreign operations ( 3.9 ) % ( 4.0 ) % ( 7.9 ) %

Excess tax benefits from stock compensation ( 2.4 ) % ( 1.2 ) % ( 1.0 ) %

Benefit derived from foreign operations ( 17.2 ) % ( 1.6 ) % ( 3.3 ) %

Nondeductible meals and entertainment 1.1 % 0.1 % 0.1 %

Intercompany profit in inventory 3.3 % 0.3 % ( 0.2 ) %

Nondeductible facilitative costs 0.2 % 0.3 % 1.1 %

Contingent Consideration ( 2.0 ) % ( 0.2 ) % 0.2 %

Research and development credit ( 5.7 ) % ( 1.4 ) % ( 1.2 ) %

Return to provision ( 0.5 ) % ( 0.7 ) % ( 2.3 ) %

Global intangible low-taxed income ("GILTI") 2.8 % 0.7 % 2.5 %

Nondeductible executive compensation 1.8 % 0.9 % 2.4 %

Fair market value step up on intra-entity transfer of intellectual property

Nondeductible executive compensation & stock compensation shortfall 2.3 % ( 0.6 ) % ( 0.3 ) %

Transaction and deal related costs

3.3 % ( 1.8 ) % 0.1 %

Gain from sale of business - book to tax differences — % — % 3.9 %

Changes in valuation allowances 4.9 % — % 0.1 %

Other 0.5 % ( 0.5 ) % ( 0.9 ) %

1 unchanged sentence

Our effective tax rate was 16.4 % and 15.6 % of income before income taxes for the years ended December 31, 2023 and December 31, 2022, respectively.

In 2023, the Company’s higher effective tax rate was driven by the the inclusion of Global Intangible Low-Taxed Income ("GILTI"), offset by a $ 5.8 million income tax benefit related to a four-year tax credit received by a Swiss subsidiary.

The Company received an extension of the 2018 Swiss tax grant for three years, until the 2027 tax year.

The net benefit of the tax credit, recorded as of December 31, 2023, was based on projections of use of the incremental tax grant.

The Company’s Swiss subsidiary may offset the tax credit against cantonal and communal income and capital taxes during tax years 2024 through 2027.

Any unused balance at the end of the 2027 tax period will be forfeited.

In 2022, the Company’s lower effective tax rate was driven by a $ 5.1 million income tax benefit related to stock compensation and a $ 2.4 million income tax benefit related to the filing of amended federal and state returns for prior years.

In 2021, the Company's higher effective tax rate was driven in part by an $ 8.5 million income tax expense for nondeductible goodwill related to the sale of the Extremity Orthopedics business, offset by a $ 3.1 million income tax benefit related to excess tax benefits from stock compensation.

In 2020, the Company’s lower worldwide effective tax rate was primarily driven by an $ 59.2 million income tax benefit on an intra-entity transfer of certain intellectual property, substantially completed during the fourth quarter in 2020.

Excluding this transaction, the effective worldwide tax rate for 2020 was 20.2 %.

During 2023, the Company’s foreign operations generated a $ 0.7 million decrease in income tax expense when compared to the same period in 2022, because of geographic and business mix of taxable earnings and losses, among other factors.

The 2023 foreign effective tax rate is 16.4 %, compared to 15.9 % in 2022.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

In December 2020, the Company completed an intra-entity transfer of certain intellectual property rights to one of its subsidiaries in Switzerland.

While the transfer did not result in a taxable gain, the Company’s Swiss subsidiary received a step-up in tax basis based on the fair value of the transferred intellectual property rights.

The Company determined the fair value using a discounted cash flow model based on expectations of revenue growth rates, royalty rates, discount rates, and useful lives of the intellectual property.

The Co mpany recorded a $ 59.2 million deferred tax benefit in Switzerland related to the amortizable tax basis in the transferred intellectual property.

During 2022, the Company’s foreign operations generated a $ 0.4 million increase in income tax expense when compared to the same period in 2021, because of geographic and business mix of taxable earnings and losses, among other factors.

1 unchanged sentence

The Company’s foreign tax rate is primarily based upon statutory rates.

During 2021, the Company’s foreign operations generated a $ 63.6 million increase in income tax expense when compared to the same period in 2020, because of the intra-entity transfer of certain intellectual property in 2020, geographic and business mix of taxable earnings and losses, among other factors.

The 2021 foreign effective tax rate is 15.2 %, compared to ( 57.1 )% in 2020.

The Company’s foreign tax rate is primarily based upon statutory rates and is also impacted by the intra-entity transfer of certain intellectual property as described above for 2020.

Changes to income tax laws and regulations, in any of the tax jurisdictions in which the Company operates, could impact the effective tax rate.

1 unchanged sentence

and non-U.S., are increasingly focused on tax reform and revenue-raising legislation.

On August 16, 2022, the Inflation Reduction Act of 2022 (the “Act”) was signed into law, the company does not expect the law to have a material impact on the company’s effective tax rate.

Further, legislation in foreign jurisdictions may be enacted, in response to the base erosion and profit-sharing (BEPS) project begun by the Organization for Economic Cooperation and Development (OECD).

The OECD recently finalized major reform of the international tax system with respect to implementing a global minimum tax rate.

On August 16, 2022, the Inflation Reduction Act of 2022 (the “Act”) was signed into law, for which the company did not experience a material impact on the company’s effective tax rate.

Further, legislation in foreign jurisdictions may be enacted, in continued response to the base erosion and profit-sharing (BEPS) project begun by the Organization for Economic Cooperation and Development (OECD).

The OECD released model rules related to a new 15% global minimum tax regime (“Pillar 2”).

Several of the jurisdictions that we operate in have already adopted some form of the model rules, which could impact the amount of taxes that the Company pays after 2023.

However, the rules are complex and provide for delays during the early transition years, if certain conditions are met.

The Company will continue to analyze the law to determine potential impacts.

At this time, the Company does not expect the Pillar 2 legislation to have a material impact on its consolidated financial statements.

Such changes in U.S.

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Total net deferred tax assets (liabilities) $ 10,763 $ ( 17,344 )

Prior period amounts were re-classed, as it relates to Leases and Other, between tax assets and liabilities within this table, to conform to the current period presentation.

The 2017 U.S.

1 unchanged sentence

effective for years beginning after December 31, 2021.

The Company’s deferred tax assets increased by $ 20.2 million within the table above, related to the 2017 Tax Act.

The Company’s deferred tax assets increased by $ 14.4 million and $ 20.3 million at December 31, 2023 and December 31, 2022 respectively within the table above, related to the 2017 Tax Act.

At December 31, 2023, the Company had net operating loss carryforwards of $ 64.7 million for federal income tax purposes, $ 98.4 million for foreign income tax purposes and $ 19.2 million for state income tax purposes to offset future taxable income.

The majority of the federal net operating loss carryforwards expire through 2037, while $ 18.6 million have an indefinite carry forward period.

For the federal net operating loss carryforwards, $ 55.8 million will expire through 2037;

while $ 8.9 million have an indefinite carry forward period.

For foreign net operating loss carryforwards, $ 81.0 million will expire through 2028, while the remaining $ 17.4 million have an indefinite carry forward period.

2 unchanged sentences

In the event that the Company determines that it would be able to realize more or less than the recorded amount of net deferred tax assets, an adjustment to the deferred tax asset valuation allowance would be recorded in the period such a determination is made.

The valuation allowance at December 31, 2022 and 2021 primarily remained unchanged from respective prior periods;

decreasing by an immaterial amount in both periods.

The valuation allowance at December 31, 2023 increased by $ 2.8 million, as compared to 2022, primarily driven by a $ 3.3 million increase related to the new Swiss tax credit.

The valuation allowance for 2022 had remained substantially unchanged, as compared to 2021.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

21 unchanged sentences

Prior years' tax positions 372 — —

Lapse of statute ( 273 ) — —

Other — — ( 26 )

1 unchanged sentence

Approximately $ 0.8 million of the balance at December 31, 2023 relates to uncertain tax positions that, if recognized, would affect the annual effective tax rate.

The Company has $ 0.3 million of uncertain tax positions at December 31, 2022 related to tax positions for which it is reasonably possible that the amounts could be reduced during the twelve months following December 31, 2022.

The Company has no uncertain tax positions at December 31, 2023 related to tax positions for which it is reasonably possible that the amounts could be reduced during the twelve months following December 31, 2023.

The Company recognizes interest and penalties relating to uncertain tax positions in income tax expense.

The Company recognized a minimal benefit for the years ended December 31, 2022, 2021 and 2020.

The Company recognized a minimal expense for the years ended December 31, 2023, 2022 and 2021.

The Company had minimal interest and penalties accrued for the years ended December 31, 2023 and 2022 and 2021.

2 unchanged sentences

consolidated Federal income tax returns by the IRS through fiscal year 2017.

Additionally, the Company is no longer subject to examinations by the IRS for fiscal year 2017.

All significant state and local matters have been concluded through fiscal year 2018.

18 unchanged sentences

Common stock of approximately 0.6 million and 0.3 million shares at December 31, 2023, and 2022 that are issuable through exercise of dilutive securities, respectively, and were not included in the computation of diluted net income per share because their effect would have been anti-dilutive.

Based on the adoption of ASU 2020-06, as the principal amount of the 2025 Notes will be paid in cash and only the conversion spread is settled in shares, the Company will be utilizing the if-converted method and only includes the net number of incremental shares that would be issued upon conversion.

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Comprehensive income for the years ended December 31, 2023 and 2022:

Dollars in thousands 2023 2022 2021

Net income $ 67,741 $ 180,550 $ 169,075

Foreign currency translation adjustment, net of tax ( 12,103 ) ( 17,807 ) ( 17,362 )

Change in unrealized loss/(gain) on derivatives, net of tax ( 6,658 ) 65,798 39,268

Pension liability adjustment, net of tax ( 6,610 ) 7,429 6,998

Comprehensive income, net 42,370 235,970 197,979

Changes in accumulated other comprehensive loss by component between December 31, 2023 and 2022 are presented in the table below, net of tax:

8 unchanged sentences

$ 21,489 $ 2,712 $ ( 39,307 ) $ ( 15,106 )

For the year ended December 31, 2022, the Company reclassified a gain of $ 15.0 million and a loss of $ 0.4 million from accumulated other comprehensive loss to other income, net and interest income, respectively.

For the year ended December 31, 2023, the Company reclassified a loss of $ 24.2 million and a gain of $ 20.1 million from accumulated other comprehensive loss to other income, net and interest income, respectively.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

COMMITMENTS AND CONTINGENCIES

3 unchanged sentences

In the opinion of management, such claims are either adequately covered by insurance or otherwise indemnified, or are not expected, individually or in the aggregate, to result in a material, adverse effect on the Company's financial condition.

However, it is possible that the

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Company's results of operations, financial position and cash flows in a particular period could be materially affected by these contingencies.

However, it is possible that the Company's results of operations, financial position and cash flows in a particular period could be materially affected by these contingencies.

The Company accrues for loss contingencies when it is deemed probable that a loss has been incurred and that loss is estimable.

1 unchanged sentence

The Company consistently accrues legal fees expected to be incurred in connection with loss contingencies as those fees are incurred by outside counsel as a period cost.

On December 21, 2023, Fortis Advisors, LLC (representative of the securityholders of ACell, Inc.) filed for arbitration against Integra Life Sciences claiming breach of contract related to the earnout consideration from the 2021 acquisition of Acell.

Refer to Note 4, Acquisitions and Divestitures, for additional information on the ACell Contingent Considerations.

The Company believes that it has strong defenses to the allegations in the arbitration and intends to defend the matter vigorously.

On September 12, 2023, a securities class action complaint, captioned Pembroke Pines Firefighters & Police Officers Pension Fund v.

Integra LifeSciences Holdings Corporation , No.

23-cv-20321 (D.N.J.), was filed by a purported stockholder of the Company in the United States District Court for the District of New Jersey (the “Pembroke Litigation”) against the Company and certain of the Company’s current and former executive officers.

The Pembroke Litigation, filed on behalf of a putative class of stockholders who purchased or acquired the Company’s common stock between March 11, 2019 and May 22, 2023, inclusive, alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder, on the basis of purportedly materially false and misleading statements and omissions relating to certain quality systems issues identified by the U.S.

Food and Drug Administration at the Company’s Boston, Massachusetts manufacturing facility, the Company’s efforts to remediate those issues, and the Company’s forecasts for certain products in its Tissue Technologies segment.

The complaint seeks, among other things, compensatory damages, attorneys’ fees, expert fees, and other costs.

The Company believes that it has strong defenses to the allegations in the Pembroke Litigation, as we intend to defend the matter vigorously.

Contingent Consideration

The Company determined the fair value of contingent consideration during the twelve-month period ended December 31, 2022 and 2021 to reflect the change in estimate, additions, payments, transfers and the time value of money during the period.

The Company determined the fair value of contingent consideration during the twelve-month period ended December 31, 2023 and 2022 to reflect the change in fair value during the period.

A reconciliation of the opening balances to the closing balances of these Level 3 measurements for the years ended December 31, 2023 and 2022 is as follows (in thousands):

Year ended December 31, 2022 Contingent Consideration Liability Related to Acquisition of:

(See Note 4) Location in Financial Statements Derma Sciences ACell Inc.

(See Note 4) SIA Location in Financial Statements

Short-term Long-term Long-term Short-term Long-term Long-term

Contingent Consideration Liability Related to Acquisition of:

Arkis Location in Financial Statements Derma Sciences ACell Surgical Innovations Associates, Inc.

(FN 4) Location in Financial Statements

Balance as of January 1, 2023

Additions — — — — 57,607

Transfers from long-term to current portion — — — 4,885 ( 4,885 ) —

$ 12,895 $ 230 $ 3,700 57,607

Change in fair value of contingent consideration liabilities 2,860 Research and development 2,327 ( 3,400 ) 11,093 Selling, general and administrative

Balance as of December 31, 2023

Year ended December 31, 2021 Contingent Consideration Liability Related to Acquisition of:

(See Note 4) Location in Financial Statements Derma Sciences ACell Inc.

(See Note 4) Location in Financial Statements

Short-term Long-term Long-term Long-term

15,755 2,557 300 68,700

Short-Term $ 7,778 $ — $ — $ 13,400 Accrued expenses and other current liabilities

Long-Term 7,977 2,557 300 55,300 Other liabilities

Total $ 15,755 $ 2,557 $ 300 $ 68,700

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Contingent Consideration Liability Related to Acquisition of:

Arkis Location in Financial Statements Derma Sciences ACell Inc.

(FN 4) Surgical Innovations Associates, Inc.

(FN 4) Location in Financial Statements

Balance as of January 1, 2022

$ 15,099 $ 230 $ 21,800 $ —

Additions — — — 57,607

Transfers from long-term to current portion 276 ( 276 ) — —

Change in fair value of contingent consideration liabilities ( 2,204 ) Research and development — ( 18,100 ) Selling, general and administrative

Balance as of December 31, 2022

$ 12,895 $ 230 $ 3,700 $ 57,607

Short-Term $ 2,845 $ — $ — $ —

Long-Term 10,050 230 3,700 57,607 Accrued expenses and other current liabilities

Total $ 12,895 $ 230 $ 3,700 $ 57,607 Other liabilities

Arkis BioSciences Inc.

As part of the acquisition of Arkis BioSciences Inc.

("Arkis"), the Company is required to pay the former shareholders of Arkis up to $ 25.5 million based on the timing of certain development milestones of $ 10.0 million and commercial sales milestones of $ 15.5 million, respectively.

The Company used a probability weighted income approach to calculate the fair value of the contingent consideration that considered the possible outcomes of scenarios related to each specified milestone.

The Company estimated the fair value of the contingent consideration to be $ 13.1 million at the acquisition date.

Derma Sciences

5 unchanged sentences

The potential maximum undiscounted payment amounts to $ 3.0 million.

The estimated fair value as of December 31, 2022 and 2021 was $ 0.2 million.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

Arkis BioSciences, Inc.

As part of the acquisition of Arkis BioSciences, Inc.

("Arkis"), the Company is required to pay the former shareholders of Arkis up to $ 25.5 million based on the timing of certain development milestones of $ 10 million and commercial sales milestones of $ 15.5 million, respectively.

The Company estimated the fair value of the contingent consideration to be $ 13.1 million at the acquisition date.

The estimated the fair value as of December 31, 2022 was $ 12.9 million.

The Company recorded $ 2.8 million in accrued expenses and other current liabilities and $ 10.1 million in other liabilities at December 31, 2022 in the consolidated balance sheets of the Company.

SEGMENT AND GEOGRAPHIC INFORMATION

4 unchanged sentences

The Corporate and other category includes (i) various executive, finance, human resource, information systems and legal functions, (ii) brand management, and (iii) share-based compensation costs.

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The operating results of the various reportable segments as presented are not comparable to one another because (i) certain operating segments are more dependent than others on corporate functions for unallocated general and administrative and/or operational manufacturing functions, and (ii) the Company does not allocate certain manufacturing costs and general and administrative costs to the operating segment results.

13 unchanged sentences

Operating income $ 111,526 $ 238,920 $ 197,230

INTEGRA LIFESCIENCES HOLDINGS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company does not allocate any assets to the reportable segments.

12 unchanged sentences

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 9A. Controls and Procedures