What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2024-02-29 compared with 2023-02-28 · 586 added, 465 removed, 986 unchanged (52% of the section changed)

3 unchanged sentences

Consolidated Balance Sheets

Consolidated Statements of Income

Consolidated Statements of Comprehensive Income

Consolidated Statements of Changes in Stockholders’/Member’s Equity

Consolidated Statements of Operations

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Changes in Stockholders’ Equity

Consolidated Statements of Cash Flows

4 unchanged sentences

We have audited the accompanying consolidated balance sheets of Maravai LifeSciences Holdings, Inc.

(the Company) as of December 31, 2022 and 2021, the related consolidated statements of income, comprehensive income, changes in stockholders’ / member’s equity and cash flows for each of the three years in the period ended December 31, 2022, and the related notes (collectively referred to as the “consolidated financial statements”).

(the Company) as of December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive (loss) income, changes in stockholders’ equity and cash flows for each of the three years in the period ended December 31, 2023, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023, in conformity with U.S.

12 unchanged sentences

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

Critical Audit Matter

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

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

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

Critical Audit Matters

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

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

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

Goodwill Impairment Assessment

Description of the Matter

At December 31, 2023, the Company has recorded goodwill of $326.0 million.

As discussed in Note 1 to the consolidated financial statements, goodwill is tested at the reporting unit level for impairment at least annually or more frequently if indicators of potential impairment exist.

Under the goodwill impairment assessment, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to the amount of the excess carrying amount of the reporting unit over its fair value.

During the current year the Company executed a quantitative assessment over the goodwill balance assigned to each reporting unit.

Auditing the Company’s recoverability test for goodwill impairment assessment was challenging due to subjective estimates and assumptions used by the Company to determine fair value of the reporting units.

The estimates were subject to higher uncertainty due to management judgements over significant assumptions, including revenue growth rates and valuation related discount rates.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s goodwill impairment process, including controls over management’s review of its projected financial information utilized in the valuation of its reporting units.

Our audit procedures over the Company’s goodwill impairment assessment included, among others, assessing the reasonableness of significant assumptions, specifically revenue growth rates, discount rates and assessing the completeness and accuracy of the underlying data used by the Company in its analyses.

We evaluated whether significant assumptions were reasonable by comparing them to industry data and current market forecasts, and whether such assumptions were consistent with evidence obtained in other areas of the audit.

We performed various sensitivity analyses around the assumptions to understand the impact on the fair value calculation.

We also involved our valuation specialists to assist us in evaluating the reasonableness of the Company’s valuation methodologies and certain significant assumptions used by the Company.

Payable to related parties pursuant to a Tax Receivable Agreement

Description of the Matter

As discussed in Notes 1 and 14 of the December 31, 2022 consolidated financial statements, the Company has recorded a $718.2 million payable to related parties pursuant to a Tax Receivable Agreement (TRA).

The TRA liability represents the amount the Company estimates to pay to the counterparties to the TRA that are former owners of the Company who are related parties (pre-IPO owners).

The liability is computed as 85% of the estimated cash tax savings to be received by the Company from utilizing the positive tax attributes contributed by pre-IPO owners.

Auditing management’s accounting for the TRA liability is complex because of the application of the tax laws used to determine the tax basis upon which to calculate the corresponding TRA liability.

As discussed in Notes 1 and 14 of the December 31, 2023 consolidated financial statements, the Company has a Tax Receivable Agreement (TRA) with certain related party investors (TRA investors).

The TRA liability represents a contractual commitment to distribute 85% of any tax benefits, realized or deemed to be realized by the Company to the TRA investors.

As of December 31, 2023, the Company has recorded a TRA liability of $7.1 million after concluding it was probable that, based on estimates of future taxable income, the Company will owe a payment to the TRA investors.

As of December 31, 2023, the Company has not recognized the remaining $665.3 million liability under the TRA after concluding it was not probable that the Company will be able to realize benefits based on estimates of future taxable income.

Auditing management’s accounting for the TRA liability is complex because of the application of the tax laws used to determine the tax basis upon which to calculate the corresponding TRA liability and assumptions around the timing and amount of taxable income in the future which impacts the recognition of the TRA liability.

These factors involved subjective auditor judgment and audit effort in performing procedures and evaluating the appropriateness of the calculation of the tax basis.

1 unchanged sentence

How We Addressed the Matter in Our Audit

Our audit procedures included, among others, testing the information used in the calculation of the TRA liability, and the involvement of professionals with specialized skills and knowledge to assist in (i) developing an independent calculation of the tax basis, (ii) comparing the independent calculation to management’s calculations to evaluate the reasonableness of the tax basis, and (iii) assessing management’s application of the tax laws.

We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the computation and recognition of the Company’s TRA liability, including testing management's controls over the completeness and accuracy of the underlying data used in the valuation and recognition, and controls over management's review of the assumptions discussed above.

Our audit procedures included, among others, testing the information used in the calculation and recognition of the TRA liability including projections of future taxable income and the involvement of professionals with specialized skills and knowledge to assist in developing an independent calculation of the tax basis, comparing the independent calculation to management’s calculations to evaluate the reasonableness of the tax basis, assessing management’s application of the tax laws, and verifying the calculation of the TRA liability was in accordance with the terms set out in the TRA.

Revenue with distributors

Description of the Matter

During the year ended December 31, 2023, the Company’s revenues were $288.9 million, of which a portion relates to products sold to distributors.

Its distributor customers resell the products to end users.

Revenues from product sales are recognized when control is transferred to the Company’s customer.

Auditing the Company’s product sales to distributors was challenging, specifically related to the effort required to audit the respective sales activity to assess whether incentives were provided that were not properly recognized.

This involved judgmentally assessing factors including distributor customer ordering patterns, contractual terms, incentives offered and after shipment credits or free goods as described in Note 1 to the consolidated financial statements.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design and tested the operating effectiveness of internal controls over the Company’s process to monitor appropriate terms and conditions for these transactions.

This includes testing relevant controls over the information systems that are important to the initiation, recording and billing of revenue transactions as well as controls over the completeness and accuracy of the data used.

Our audit procedures over the Company’s product sales to distributor customers included, among others, performing analytical procedures to detect and investigate anomalies within the data.

We also examined the terms and conditions of selected new or amended contracts with distributor customers and its impact on the Company’s recognition model.

We also confirmed the terms and conditions of contracts directly with a selection of distributor customers, including whether there are side agreements and terms not formally included in the contract that may impact the Company’s revenue recognition.

In addition, we obtained written representations from members of the commercial organization regarding the completeness of the terms and conditions reported to the legal and accounting departments.

/s/ Ernst & Young LLP

6 unchanged sentences

Current assets:

Cash $ 632,138 $ 551,272

Cash and cash equivalents $ 574,962 $ 632,138

Accounts receivable, net 54,605 138,624

16 unchanged sentences

Current portion of long-term debt 5,440 5,440

Current portion of finance lease liabilities 633 —

Total current liabilities 87,468 110,144

Long-term debt, less current portion 518,707 521,997

Finance lease liabilities, less current portion 31,897 —

Payable to related parties pursuant to the Tax Receivable Agreement, less current portion — 675,956

6 unchanged sentences

Class B common stock, $ 0.01 par value - 300,000 shares authorized;

123,669 shares issued and outstanding as of December 31, 2022 and 2021

119,094 and 123,669 shares issued and outstanding as of December 31, 2023 and 2022

Additional paid-in capital 128,503 137,898

7 unchanged sentences

MARAVAI LIFESCIENCES HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share and per unit amounts)

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

Year Ended December 31,

6 unchanged sentences

Change in estimated fair value of contingent consideration ( 3,286 ) ( 7,800 ) —

Restructuring

Gain on sale of business — — ( 11,249 )

Gain on sale and leaseback transaction — — ( 19,002 )

Total operating expenses 320,593 308,785 244,595

Income from operations 574,216 554,645 119,902

(Loss) income from operations ( 31,648 ) 574,216 554,645

Other income (expense):

5 unchanged sentences

Income before income taxes

617,736 551,472 530,765

Income tax expense 756,111 60,809 61,515

Net income 490,663 469,250 78,816

Net income (loss) attributable to non-controlling interests 270,458 287,213 ( 10,156 )

Net income attributable to Maravai LifeSciences Holdings, Inc.

Net (loss) income ( 138,375 ) 490,663 469,250

Net (loss) income attributable to non-controlling interests ( 19,346 ) 270,458 287,213

Net (loss) income attributable to Maravai LifeSciences Holdings, Inc.

$ ( 119,029 ) $ 220,205 $ 182,037

Net income per Class A common share/unit attributable to Maravai LifeSciences Holdings, Inc.:

Net (loss) income per Class A common share attributable to Maravai LifeSciences Holdings, Inc.:

Basic $ ( 0.90 ) $ 1.67 $ 1.59

Diluted $ ( 0.90 ) $ 1.67 $ 1.56

Weighted average number of Class A common shares/units outstanding:

Weighted average number of Class A common shares outstanding:

Basic 131,919 131,545 114,791

2 unchanged sentences

MARAVAI LIFESCIENCES HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(in thousands)

1 unchanged sentence

2023 2022 2021

Net income $ 490,663 $ 469,250 $ 78,816

Net (loss) income

$ ( 138,375 ) $ 490,663 $ 469,250

Other comprehensive income:

Foreign currency translation adjustments — — 55

Total other comprehensive income 490,663 469,305 78,772

Comprehensive income attributable to non-controlling interests 270,458 287,224 ( 10,156 )

Total comprehensive income attributable to Maravai LifeSciences Holdings, Inc.

Total other comprehensive (loss) income

( 138,375 ) 490,663 469,305

Comprehensive (loss) income attributable to non-controlling interests

( 19,346 ) 270,458 287,224

Total comprehensive (loss) income attributable to Maravai LifeSciences Holdings, Inc.

$ ( 119,029 ) $ 220,205 $ 182,081

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

MARAVAI LIFESCIENCES HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’/MEMBER’S EQUITY

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(in thousands)

Class A Common Stock Class B Common Stock

Member’s Equity Shares Amount Shares Amount Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Non-controlling Interest Total Stockholders’/Member’s Equity

December 31, 2019 $ 141,529 — $ — — $ — $ — $ — $ ( 133 ) $ 3,231 $ 144,627

Activity prior to initial public offering ("IPO") and related Organizational Transactions:

Repurchase of MLSC Holdings, LLC ("MLSC") incentive units ( 9,140 ) — — — — — — — — ( 9,140 )

Distributions to non-controlling interests holders ( 88,880 ) — — — — — — — — ( 88,880 )

Unit-based compensation 1,793 — — — — — — — 1,483 3,276

Net income 88,118 — — — — — — — 98 88,216

Purchase of non-controlling interests in MLSC ( 161,615 ) — — — — — — — ( 4,812 ) ( 166,427 )

Foreign currency translation adjustment — — — — — — — ( 1 ) — ( 1 )

Effects of the IPO and related Organizational Transactions:

Effects of Organizational Transactions 28,195 28,966 289 160,974 1,610 ( 200,390 ) — 114 10,236 ( 159,946 )

Issuance of Class A common stock in connection with the IPO, net of issuance costs of $ 108,571

— 69,000 690 — — 1,753,742 — — — 1,754,432

Acquisition of preexisting LLC Units from MLSH 1 — — — — — ( 1,421,760 ) — ( 29 ) ( 2,538 ) ( 1,424,327 )

Non-controlling interest adjustment for purchase of LLC Units from Topco LLC with proceeds from IPO — — — — — ( 58,940 ) — ( 1 ) 58,941 —

Repurchase and retirement of Class A common from MLSH 2 — ( 1,319 ) ( 13 ) — — ( 33,645 ) — — — ( 33,658 )

Equity-based compensation — — — — — 2,980 — — 17,407 20,387

Net loss — — — — — — ( 3,044 ) — ( 17,787 ) ( 20,831 )

Recognition of impact of entering into Tax Receivable Agreement — — — — — 42,776 — — — 42,776

Activity subsequent to the initial public offering and related Organizational Transactions:

Equity-based compensation — — — — — 362 — — 604 966

Class A Common Stock Class B Common Stock

Net income — — — — — — 3,898 — 7,533 11,431

Foreign currency translation adjustment — — — — — — — 6 10 16

Tax distribution to non-controlling interest holder — — — — — — — — ( 8,171 ) ( 8,171 )

Shares Amount Shares Amount Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Non-controlling Interest Total Stockholders’ Equity

December 31, 2020 96,647 $ 966 160,974 $ 1,610 $ 85,125 $ 854 $ ( 44 ) $ 66,235 $ 154,746

5 unchanged sentences

Non-controlling interest adjustment for changes in proportionate ownership in Topco LLC — — — — ( 809 ) — — 809 —

Stock-based compensation — — — — — 4,645 — — 5,813 10,458

Equity-based compensation

— — — — 4,645 — — 5,813 10,458

Distribution for tax liabilities to non-controlling interest holder — — — — ( 41 ) — — ( 153,451 ) ( 153,492 )

3 unchanged sentences

Issuance of Class A common stock under employee equity plans, net of shares withheld for employee taxes 204 2 — — 2,303 — — — 2,305

Non-controlling interest adjustment for changes in proportionate ownership in Topco LLC — — — — — ( 864 ) — — 864 —

Stock-based compensation — — — — — 9,623 — — 9,047 18,670

Class A Common Stock Class B Common Stock

Shares Amount Shares Amount Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Non-controlling Interest Total Stockholders’ Equity

Non-controlling interest adjustment for changes in proportionate ownership in Topco LLC — — — — ( 864 ) — — 864 —

Equity-based compensation

— — — — 9,623 — — 9,047 18,670

Distribution for tax liabilities to non-controlling interest holder — — — — 141 — — ( 150,206 ) ( 150,065 )

2 unchanged sentences

December 31, 2022 131,692 1,317 123,669 1,237 137,898 404,766 — 360,025 905,243

Effects of Structuring Transactions — — ( 4,575 ) ( 46 ) ( 25,404 ) — — 26,392 942

Issuance of Class A common stock under employee equity plans, net of shares withheld for employee taxes 536 5 — — 116 — — — 121

Non-controlling interest adjustment for changes in proportionate ownership in Topco LLC — — — — 754 — — ( 754 ) —

Equity-based compensation

— — — — 18,167 — — 16,421 34,588

Distribution for tax liabilities to non-controlling interest holder — — — — — — — ( 9,607 ) ( 9,607 )

Impact of change to deferred tax asset associated with equity-based compensation

— — — — ( 3,028 ) — — — ( 3,028 )

Net loss — — — — — ( 119,029 ) — ( 19,346 ) ( 138,375 )

December 31, 2023 132,228 $ 1,322 119,094 $ 1,191 $ 128,503 $ 285,737 $ — $ 373,131 $ 789,884

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

5 unchanged sentences

Operating activities:

Net income $ 490,663 $ 469,250 $ 78,816

Adjustments to reconcile net income to net cash provided by operating activities:

Net (loss) income $ ( 138,375 ) $ 490,663 $ 469,250

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

Depreciation 12,898 7,566 6,413

Amortization of intangible assets 27,356 24,269 18,339

Amortization of right-of-use assets 6,268 8,792 —

Amortization of operating lease right-of-use assets

8,527 6,268 8,792

Amortization of deferred financing costs 2,929 2,788 2,676

4 unchanged sentences

Gain on sale of business — — ( 11,249 )

Gain on sale and leaseback transaction — — ( 19,002 )

Acquired and in-process research and development costs — — 2,881

Financing costs incurred for line of credit — — ( 3,239 )

Revaluation of liabilities under the Tax Receivable Agreement ( 668,886 ) 4,102 ( 6,101 )

14 unchanged sentences

Proceeds from government assistance allocated to property and equipment

12,865 1,105 —

Prepaid lease payments on finance lease yet to commence — ( 13,278 ) —

5 unchanged sentences

Proceeds from borrowings of long-term debt, net of discount — 8,455 —

Financing costs incurred for long-term debt — — ( 9,295 )

Repurchase of incentive units — — ( 9,140 )

Principal repayments of long-term debt ( 5,440 ) ( 13,895 ) ( 6,000 )

Payment of contingent consideration — — ( 1,439 )

Payments made on facility financing lease obligation and capital lease — — ( 201 )

Year Ended December 31,

2022 2021 2020

Payments of finance lease liabilities ( 332 ) — —

Proceeds from derivative instruments 6,168 — —

Payment of acquisition consideration holdback ( 9,706 ) — —

Payments to MLSH 1 pursuant to the Tax Receivable Agreement ( 35,661 ) ( 29,108 ) ( 1,115 )

Payments to MLSH 2 pursuant to the Tax Receivable Agreement ( 6,492 ) ( 5,103 ) ( 192 )

Payment for non-controlling interests in MLSC — — ( 120,005 )

Payment to MLSH 2 for Blocker Mergers — — ( 208,053 )

Proceeds from issuance of Class A common stock sold in IPO, net of offering costs — — 1,757,245

Proceeds from issuance of Class B common stock sold to MLSH 1 — — 1,687

Purchase of LLC Units from MLSH 1 — — ( 1,424,324 )

Repurchase of Class A common stock from MLSH 2 — — ( 33,658 )

Proceeds from issuance of Class A common stock under employee equity plans, net of shares withheld for employee taxes 2,358 1,709 321

Net cash (used in) provided by financing activities ( 187,499 ) ( 159,049 ) 53,212

Shares withheld for employee taxes, net of proceeds from issuance of Class A common stock under employee equity plans ( 20 ) 2,358 1,709

Year Ended December 31,

2023 2022 2021

Net cash used in financing activities

( 61,090 ) ( 187,499 ) ( 159,049 )

Effects of exchange rate changes on cash — — ( 88 )

Net increase in cash 80,866 315,088 211,484

Cash, beginning of period 551,272 236,184 24,700

Cash, end of period $ 632,138 $ 551,272 $ 236,184

Net (decrease) increase in cash and cash equivalents ( 57,176 ) 80,866 315,088

Cash and cash equivalents, beginning of period 632,138 551,272 236,184

Cash and cash equivalents, end of period $ 574,962 $ 632,138 $ 551,272

Supplemental cash flow information:

Cash paid for interest $ 44,256 $ 20,198 $ 27,234

Cash paid for income taxes $ 23,032 $ 22,473 $ 5,006

Cash (refunded) paid for income taxes, net $ ( 2,987 ) $ 23,032 $ 22,473

Supplemental disclosures of non-cash activities:

Property and equipment included in accounts payable and accrued expenses $ 2,011 $ 1,701 $ 2,149

Financing cost deducted from long-term debt proceeds $ — $ — $ 6,000

Accrued receivable for capital expenditures to be reimbursed under a government contract $ 1,118 $ — $ —

Right-of-use assets obtained in exchange for new finance lease liabilities $ 32,862 $ — $ —

Right-of-use assets obtained in exchange for new operating lease liabilities $ 3,931 $ 17,513 $ —

Building and improvements capitalized under lease financing transaction $ — $ — $ 700

Fair value of contingent consideration liability recorded in connection with acquisition of a business $ 5,289 $ 7,800 $ —

Accrued consideration payable for MyChem acquisition $ — $ 10,000 $ —

Exchange of units for MLSC non-controlling interests $ — $ — $ 46,422

Exchange of Class A common stock for the Blocker Mergers $ — $ — $ 782,073

Recognition of deferred tax assets from Organizational Transactions, subsequent exchanges and cash contribution $ — $ 423,361 $ 441,984

Recognition of deferred tax assets as a result of exchanges of LLC Units and cash contribution

$ — $ — $ 423,361

Recognition of liabilities under the Tax Receivable Agreement $ — $ — $ 366,179

IPO issuance costs included in accounts payable and accrued expenses $ — $ — $ 2,816

Receivable from lessor funded financing $ — $ — $ 1,987

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

10 unchanged sentences

Our Nucleic Acid Production business manufactures and sells products used in the fields of gene therapy, vaccines, nucleoside chemistry, oligonucleotide therapy and molecular diagnostics, including reagents used in the chemical synthesis, modification, labelling and purification of deoxyribonucleic acid (“DNA”) and ribonucleic acid (“RNA”).

Our core Nucleic Acid Production offerings include messenger ribonucleic acid (“mRNA”), long and short oligonucleotides, our proprietary CleanCap® capping technology and oligonucleotide building blocks.

Our Biologics Safety Testing business sells highly specialized analytical products for use in biologic manufacturing process development, including custom product-specific development antibody and assay development services.

1 unchanged sentence

We were incorporated as a Delaware corporation in August 2020 for the purpose of facilitating an initial public offering (“IPO”).

Immediately prior to the IPO, we effected a series of organizational transactions (the “Organizational Transactions”) as discussed in Note 10, which, together with the IPO, were completed in November 2020, that resulted in the Company operating, controlling all of the business affairs and becoming the ultimate parent company of Maravai Topco Holdings, LLC (“Topco LLC”) and its consolidated subsidiaries.

Maravai Life Sciences Holdings, LLC (“MLSH 1”), which is controlled by investment entities affiliated with GTCR, LLC (“GTCR”), is the only other member of Topco LLC.

The Company is the sole managing member of Topco LLC, which operates and controls TriLink Biotechnologies, LLC (“TriLink”), Glen Research, LLC, MockV Solutions, LLC and Cygnus Technologies, LLC (“Cygnus”) and their respective subsidiaries.

Immediately prior to the IPO, we effected a series of organizational transactions (the “Organizational Transactions”), which, together with the IPO, were completed in November 2020, that resulted in the Company operating, controlling all of the business affairs and becoming the ultimate parent company of Maravai Topco Holdings, LLC (“Topco LLC”) and its consolidated subsidiaries.

Maravai Life Sciences Holdings, LLC (“MLSH 1”), which is controlled by investment entities affiliated with GTCR, is the only other member of Topco LLC.

The Company is the sole managing member of Topco LLC, which operates and controls TriLink Biotechnologies, LLC (“TriLink”), Glen Research, LLC, MockV Solutions, LLC, Cygnus Technologies, LLC and Alphazyme, LLC (“Alphazyme”) and their respective subsidiaries.

Prior to the Company’s divestiture of its Protein Detection business in September 2021, Topco LLC also operated and controlled Vector Laboratories, Inc.

2 unchanged sentences

The Company operates and controls all of the business and affairs of Topco LLC, and, through Topco LLC and its subsidiaries, conducts its business.

Because we manage and operate the business and control the strategic decisions and day-to-day operations of Topco LLC and also have a substantial financial interest in Topco LLC, we consolidate the financial results of Topco LLC, and a portion of our net income is allocated to the non-controlling interests in Topco LLC held by MLSH 1.

The Organizational Transactions were considered transactions between entities under common control.

As a result, the consolidated financial statements for periods prior to the IPO have been adjusted to combine the previously separate entities for presentation purposes.

Because we manage and operate the business and control the strategic decisions and day-to-day operations of Topco LLC and also have a substantial financial interest in Topco LLC, we consolidate the financial results of Topco LLC, and a portion of our net (loss) income is allocated to the non-controlling interests in Topco LLC held by MLSH 1.

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S.

3 unchanged sentences

The Company consolidates all entities that it controls through a majority voting interest or as the primary beneficiary of a variable interest entity (“VIE”).

of the entity and (ii) the obligation to absorb losses of, or the right to receive benefits from, the entity that could potentially be significant to that entity.

In determining whether the Company is the primary beneficiary of an entity, the Company applies a qualitative approach that determines whether it has both (i) the power to direct the economically significant activities of the entity and (ii) the obligation to absorb losses of, or the right to receive benefits from, the entity that could potentially be significant to that entity.

The Company’s determination about whether it should consolidate such VIEs is made continuously as changes to existing relationships or future transactions may result in a consolidation event.

7 unchanged sentences

Revenue Recognition

The Company generates revenue primarily from the sale of products, and to a much lesser extent, services in the fields of nucleic acid production, biologics safety testing, and protein detection.

Revenue is recognized when control of promised goods or services is transferred to a customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

The Company generates revenue primarily from the sale of products, and to a much lesser extent, services in the fields of nucleic acid production and biologics safety testing.

Prior to September 2021, the Company also generated revenue from its Protein Detection business.

Products are sold primarily through a direct sales force and through distributors in certain international markets where the Company does not have a direct commercial presence.

Revenue is recognized when control of promised goods or services is transferred to a customer or distributor in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

Distributors are the principal in all sales transactions with its customers.

To determine revenue recognition for its arrangements with customers, the Company performs the following five steps:

12 unchanged sentences

Contracts with customers are evaluated on a contract-by-contract basis as contracts may include multiple types of goods and services as described below.

Revenue from sales to customers through distributors are recognized consistent with the policies and practices for direct sales to customers, as described above.

Nucleic Acid Production

Nucleic Acid Production revenue is generated from the manufacture and sale of highly modified, complex nucleic acids products to support the needs of our of customers’ research, therapeutic and vaccine programs.

The primary offering of products includes CleanCap, mRNA, and specialized oligonucleotides.

The primary offering of products includes CleanCap, mRNA, specialized oligonucleotides, and enzymes.

Contracts typically consist of a single performance obligation.

We also sell nucleic acid products for labeling and detecting proteins in cells and tissue samples research.

The Company recognizes revenue from these products in the period in which the performance obligation is satisfied by transferring control to the customer.

Revenue for nucleic acid catalog products is recognized at a single point in time, generally upon shipment to the customer.

The Company recognizes revenue from these products in the period in which the performance obligation is satisfied by transferring control to the customer or distributor.

Revenue for nucleic acid catalog products is recognized at a single point in time, generally upon shipment to the customer or distributor.

Revenue for contracts for certain custom nucleic acid products, with an enforceable right to payment and a reasonable margin for work performed to date, is recognized over time, based on a cost-to-cost input method over the manufacturing period.

1 unchanged sentence

Biologics Safety Testing

The Company’s Biologics Safety Testing revenue is associated with the sale of bioprocess impurity detection kit products.

We also enter into contracts that include custom antibody development, assay development and antibody affinity extraction services.

These products and services enable the detection of impurities that occur in the manufacturing of biologic drugs and other therapeutics.

The Company recognizes revenue from the sale of bioprocess impurity detection kits in the period in which the performance obligation is satisfied by transferring control to the

The Company’s Biologics Safety Testing revenue is associated with the sale of host cell protein, bioprocess impurity detection, viral clearance prediction kits and associated products.

We also enter into contracts that include custom

antibody development, assay development, antibody affinity extraction and mass spectrometry services.

These products and services enable the detection of impurities that occur in the manufacturing of biologic drugs and other therapeutics including cell and gene therapies.

The Company recognizes revenue from the sale of kits and products in the period in which the performance obligation is satisfied by transferring control to the customer.

Custom antibody development contracts consist of a single performance obligation, typically with an enforceable right to payment and a reasonable margin for work performed to date.

2 unchanged sentences

Assay development service contracts consist of a single performance obligation, revenue is recognized at a point in time when a successful antigen test and report is provided to the customer.

Affinity extraction services, which generally occur over a short period of time, consist of a single performance obligation to perform the extraction service and provide a summary report to the customer.

Revenue is recognized either over time or at a point in time depending on contractual payment terms with the customer.

Affinity extraction, mass spectrometry and other analytical services, which generally occur over a short period of time, consist of a single performance obligation to perform the service and provide a summary report to the customer.

Revenue is recognized upon delivery of the report to the customer.

The Company elected the practical expedient to not disclose the unfulfilled performance obligations for contracts with an original length of one year or less.

37 unchanged sentences

Year Ended December 31, 2022

Nucleic Acid Production Biologics Safety Testing Protein Detection Total

Nucleic Acid Production Biologics Safety Testing Total

North America $ 312,119 $ 27,354 $ 339,473

23 unchanged sentences

Advertising costs incurred were approximately $ 2.9 million, $ 2.5 million and $ 1.3 million during the years ended December 31, 2023, 2022 and 2021, respectively.

Restructuring Costs

Restructuring costs relate to a cost realignment plan implemented by the Company in November 2023 to optimize business operations and match them to current market conditions.

Restructuring costs are comprised of severance and other employee-related costs, facility and other exit costs, professional fees and other restructuring costs.

Employee separation costs principally consist of one-time termination benefits and other post-employment benefits.

One-time termination benefits are expensed at the date the entity notifies the employee, unless the employee must provide future service, in which case the benefits are expensed over the future service period.

Other post-employment benefits are expensed when the obligation is probable and the benefit amounts are estimable.

Other costs associated with restructuring activities, including facility and other exist costs and professional fees, are expensed as they are incurred.

Equity-Based Compensation

3 unchanged sentences

We account for forfeitures as they occur.

Stock-based compensation is classified in the accompanying consolidated statements of income based on the function to which the related services are provided.

Stock-based compensation is classified in the accompanying consolidated statements of operations based on the function to which the related services are provided.

The Company estimates the fair value of stock option grants using the Black-Scholes option pricing model.

6 unchanged sentences

The assumptions used in estimating the fair value of these awards, such as expected term, volatility and risk-free interest rate, represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment.

For PSUs which are subject to a performance condition, compensation expense is recognized on a straight-line basis over the requisite service period when the achievement of such performance condition is determined probable, and upon achieving such performance condition that was not previously considered as probable, records a cumulative catch-up adjustment to reflect the portion of the grantee’s requisite service that has been provided to date.

If a performance condition is not determined probable or is not met, no compensation expense is recognized, and any previously recognized expense is reversed.

The fair value of such PSUs is determined based on the quoted market price of the Company’s Class A common stock on the date of grant.

Unit-Based Compensation

16 unchanged sentences

tax purposes during the year ended December 31, 2021.

Topco LLC’s other subsidiaries are treated as pass-through entities for federal and state income tax purposes.

Topco LLC’s wholly-owned subsidiary, Maravai LifeSciences International Holdings, Inc., is a taxpaying entity for U.S.

and foreign jurisdictions and had limited activity subject to a transfer pricing arrangement during the year ended December 31, 2023.

Topco LLC’s other subsidiaries are treated as pass-through

entities for federal and state income tax purposes.

The income or loss generated by these entities is not taxed at the LLC level.

2 unchanged sentences

As such, our tax provision consists solely of the activities of Maravai Inc.

and its subsidiaries, prior to their disposal, as well as our share of income generated by Topco LLC.

and its subsidiaries, prior to their disposal, and Maravai LifeSciences International Holdings, Inc., as well as our share of income or loss generated by Topco LLC.

We account for income taxes under the asset and liability method of accounting.

11 unchanged sentences

Such differences, if identified in future periods, could have a material effect on the amounts recorded in our consolidated financial statements.

Interest and penalties related to unrecognized tax benefits are recognized in income tax expense in the accompanying consolidated statements of income.

Interest and penalties related to unrecognized tax benefits are recognized in income tax expense in the accompanying consolidated statements of operations.

The provision for income taxes includes the effects of any accruals that the Company believes are appropriate, as well as any related net interest and penalties.

11 unchanged sentences

If, due to a change in facts, these tax attributes are not utilized in future years, it is reasonably possible no amounts would be paid under the TRA.

In this scenario, the reduction of the liability under the TRA would result in a benefit to our consolidated statements of income.

Subsequent adjustments to the payable to related parties for the TRA based on changes in anticipated future taxable income are recorded in our consolidated statements of income.

In this scenario, the reduction of the liability under the TRA would result in a benefit to our consolidated statements of operations.

Subsequent adjustments to the payable to related parties for the TRA based on changes in anticipated future taxable income are recorded in our consolidated statements of operations.

Non-Controlling Interests

Non-controlling interests re present the portion of profit or loss, net assets and comprehensive income of our consolidated subsidiaries that is not allocable to the Company based on our percentage of ownership of such entities.

Non-controlling interests consist of the following:

• Until November, 2020 Topco LLC held a 70 % ownership interest in MLSC Holdings, LLC (“MLSC”) through its consolidated subsidiaries with the remaining 30 % being recorded as non-controlling interests in our consolidated financial statements .

MLSC net income or loss was attributed to the non-controlling interests using an attribution method, similar to the hypothetical liquidation at book value method, based on the distribution provisions of the MLSC Amended and Restated Limited Liability Company Agreement (“MLSC LLC Agreement”).

In November 2020, and before the closing of the IPO, Topco LLC repurchased all of the outstanding non-controlling interests in MLSC for $ 166.4 million (see Note 13) .

Non-controlling interests re present the portion of profit or loss, net assets and comprehensive (loss) income of our consolidated subsidiaries that is not allocable to the Company based on our percentage of ownership of such entities.

In November 2020, following the completion of the Organizational Transactions, we became the sole managing member of Topco LLC.

1 unchanged sentence

Therefore, we report non-controlling interests based on the percentage of LLC Units of Topco LLC held by MLSH 1 on our consolidated balance sheet as of December 31, 2023.

Income or loss attributed to the non-controlling interest in Topco

LLC is based on the LLC Units outstanding during the period for which the income or loss is generated and is presented on the consolidated statements of income and consolidated statements of comprehensive income.

Income or loss attributed to the non-controlling interest in Topco LLC is based on the LLC Units outstanding during the period for which the income or loss is generated and is presented on the consolidated statements of operations and consolidated statements of comprehensive (loss) income.

MLSH 1 is entitled to exchange LLC Units, together with an equal number of shares of our Class B common stock (together referred to as “Paired Interests”), for shares of Class A common stock on a one -for-one basis or, at our election, for cash, from a substantially concurrent public offering or private sale (based on the price of our Class A common stock in such public offering or private sale).

As such, future exchanges of Paired Interests by MLSH 1 will result in a change in ownership and reduce or increase the amount recorded as non-controlling interests and increase or decrease additional paid-in-capital when Topco LLC has positive or negative net assets, respectively.

Distributions of $ 9.6 million, $ 150.2 million and $ 153.5 million for tax liabilities were made to MLSH 1 during the years ended December 31, 2023, 2022 and 2021, respectively.

Segment Information

7 unchanged sentences

Nucleic Acid Production and Biologics Safety Testing.

Cash consists of deposits held at financial institutions.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.

The carrying value of these cash equivalents approximates fair value.

Cash and cash equivalents consist of deposits held at financial institutions and money market funds.

Accounts Receivable and Allowance for Credit Losses

3 unchanged sentences

In certain instances, the Company may identify individual accounts receivable assets that do not share risk characteristics with other accounts receivable, in which case the Company records its expected credit losses on an individual asset basis.

As of December 31, 2022 and 2021, the allowance for credit losses was approximately $ 2.2 million and $ 0.3 million, respectively.

Write-offs of accounts receivable and recoveries were not significant during the years ended December 31, 2022 or 2021.

The allowance for credit losses was approximately $ 1.4 million and $ 2.2 million as of December 31, 2023 and 2022, respectively.

Write-offs of accounts receivable were $ 0.7 million during the year ended December 31, 2023.

Write-offs of accounts receivable were not significant during the years ended December 31, 2022 and 2021.

There were $ 0.5 million of recoveries during the year ended December 31, 2023.

Recoveries were not significant during the years ended December 31, 2022 and 2021.

Inventories consist of raw materials, work-in-process and finished goods.

2 unchanged sentences

The Company regularly monitors for excess and obsolete inventory based on its estimates of expected sales volumes, production capacity and expiration of raw materials, work-in-process and finished products, and reduces the carrying value of inventory accordingly.

The Company writes down inventory that has become obsolete, inventory that has a cost basis in excess of its expected net realizable value, and inventory in excess of expected manufacturing requirements.

The Company writes down inventory that has become

obsolete, inventory that has a cost basis in excess of its expected net realizable value, and inventory in excess of expected manufacturing requirements.

Any write-downs of inventories are charged to cost of revenue.

6 unchanged sentences

This is because the awarding entity is not considered to be a customer, the receipt of the funding is not predicated on the Company’s income tax position, there are no refund provisions, and the entity is not receiving reciprocal value for their support provided to the Company.

The Company’s elected policy is to recognize such assistance as a reduction to the carrying amount of the assets associated with the award when

it is reasonably assured that the funding will be received as evidenced through the existence of an arrangement, amounts eligible for reimbursement are determinable and have been incurred or paid, the applicable conditions under the arrangement have been met, and collectability of amounts due is reasonably assured.

The Company’s elected policy is to recognize such assistance as a reduction to the carrying amount of the assets associated with the award when it is reasonably assured that the funding will be received as evidenced through the existence of an arrangement, amounts eligible for reimbursement are determinable and have been incurred or paid, the applicable conditions under the arrangement have been met, and collectability of amounts due is reasonably assured.

Property and Equipment

9 unchanged sentences

Goodwill represents the excess of consideration transferred over the estimated fair value of assets acquired and liabilities assumed in a business combination.

Goodwill is not amortized but is reviewed for impairment.

Goodwill is allocated to the Company’s reporting units, which are components of our business for which discrete cash flow information is available one level below its operating segment.

The Company conducts a goodwill impairment analysis at least annually and more frequently if changes in facts and circumstances indicate that the fair value of the Company’s reporting units may be less than carrying amount.

1 unchanged sentence

If it is more likely than not that the fair value of the reporting unit is less than its carrying amount, or if the Company elects not to perform the qualitative impairment test, the Company then performs a quantitative impairment test.

The Company’s annual or interim quantitative impairment testing is performed by comparing the estimated fair value of the reporting unit to its carrying value.

An impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value, not to exceed the carrying value of goodwill.

The quantitative impairment test is performed using a one-step process.

The process is to compare the fair value of a reporting unit with its carrying amount.

If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not impaired.

If the carrying amount of a reporting unit exceeds its fair value, goodwill of the reporting unit is impaired and an impairment loss is recognized in an amount equal to that excess up to the total amount of goodwill included in the reporting unit.

Intangible Assets

1 unchanged sentence

Certain criteria are used in determining whether intangible assets acquired in a business combination must be recognized and reported separately.

Finite-lived intangible assets are initially recognized at fair value, are subject to amortization and are subsequently stated at amortized cost.

Finite-lived intangible assets are initially

recognized at fair value, are subject to amortization and are subsequently stated at amortized cost.

The Company’s finite-lived intangible assets are amortized using a method that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise used.

2 unchanged sentences

Impairment of Long-Lived and Intangible Assets

The Company periodically reviews long-lived assets, including property and equipment, right-of-use operating lease assets and finite-lived intangible assets, to determine whether current events or circumstances indicate that such carrying amounts may not be recoverable.

The Company periodically reviews long-lived assets, including property and equipment, right-of-use lease assets and finite-lived intangible assets, to determine whether current events or circumstances indicate that such carrying amounts may not be recoverable.

If such facts or circumstances are determined to exist, an estimate of the undiscounted future cash flows of these assets is compared to the carrying value of the assets to determine whether impairment exists.

1 unchanged sentence

If we determine that events and circumstances warrant a revision to the remaining period of amortization or depreciation for a specific long-lived asset, its remaining estimated useful life will be revised, and the remaining carrying amount of the long-lived asset will be depreciated or amortized prospectively over the revised remaining estimated useful life.

No impairment loss was recognized for long-lived assets for any period presented.

Contingent Consideration

Contingent consideration represents additional consideration that may be transferred to former owners of an acquired entity in the future if certain future events occur or conditions are met.

Contingent consideration resulting from the acquisition of a business is recorded at fair value on the acquisition date.

Such contingent consideration is re-measured to its estimated fair value at each reporting date with the change in fair value recognized within operating expenses in the Company’s consolidated statements of income.

Subsequent changes in the fair value of the contingent consideration are classified as an adjustment to cash flows from operating activities in the consolidated statements of cash flows because the change in fair value is an input in determining net income.

Cash paid in settlement of contingent consideration liabilities are classified as cash flows from financing activities up to the acquisition date fair value with any excess classified as cash flows from operating activities.

Changes in the fair value of contingent consideration liabilities associated with the acquisition of a business can result from updates to assumptions such as the expected timing or probability of achieving customer-related performance targets, specified sales milestones, changes in projected revenue or changes in discount rates.

Judgment is used in determining those assumptions as of the acquisition date and for each subsequent reporting period.

Therefore, any changes in the fair value will impact the Company’s results of operations in such reporting period, thereby resulting in potential variability in the Company’s operating results until such contingencies are resolved.

No impairment loss was recognized for long-lived or intangible assets for any period presented.

Debt Issuance Costs

20 unchanged sentences

If control over a legal entity is being evaluated, the Company also evaluates if the target is a variable interest or voting interest entity.

For acquisitions of voting interest entities, the Company applies a screen test to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets.

If the screen test is met, the transaction is accounted for as an

acquisition of assets.

For acquisitions of voting interest entities, the

Company applies a screen test to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets.

If the screen test is met, the transaction is accounted for as an acquisition of assets.

If the screen is not met, further determination is required as to whether or not the Company has acquired inputs and processes that have the ability to create outputs which would meet the definition of a business.

4 unchanged sentences

Contingent consideration liabilities are recognized at their estimated fair value on the acquisition date.

Contingent consideration arrangements that are determined to be compensatory in nature are recognized as post combination expense in our consolidated statements of income ratably over the implied service period beginning in the period it becomes probable such amounts will become payable.

Contingent consideration arrangements that are determined to be compensatory in nature are recognized as post combination expense in our consolidated statements of operations ratably over the implied service period beginning in the period it becomes probable such amounts will become payable.

The excess of the purchase price of the acquisition over the fair value of the identifiable net assets of the acquiree is recorded as goodwill.

4 unchanged sentences

Each of these factors can significantly affect the value attributed to the identifiable intangible asset acquired in a business combination.

The Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present at the inception of the arrangement and if such a lease is classified as a financing lease or operating lease.

Leases with a term greater than one year are included in other assets, accrued expenses and other current liabilities, and other long-term liabilities on our balance sheet as of December 31, 2022 and 2021.

The Company has elected not to recognize on the balance sheet leases with terms of one year or less.

Contingent Consideration

Contingent consideration represents additional consideration that may be transferred to former owners of an acquired entity in the future if certain future events occur or conditions are met.

Contingent consideration resulting from the acquisition of a business is recorded at fair value on the acquisition date.

Judgment is used in determining those assumptions as of the acquisition date and for each subsequent reporting period.

Finance leases with a term greater than one year are included in property and equipment, current portion of finance lease liabilities, and finance lease liabilities, less current portion on our consolidated balance sheets.

Operating leases with a term greater than one year are included in other assets, accrued expenses and other current liabilities, and other long-term liabilities on our consolidated balance sheets.

The Company has elected not to recognize on the consolidated balance sheet leases with terms of one year or less.

Right-of-use (“ROU”) assets represents the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease contract.

20 unchanged sentences

2023 2022 2021 2023 2022

BioNTech SE 34.8 % 29.5 % 16.7 % 12.0 % *

Nacalai USA, Inc.

19.3 % * * 27.3 % 20.3 %

* * 15.3 % 13.0 % 15.7 %

Nacalai USA, Inc.

BioNTech SE * 34.8 % 29.5 % * 12.0 %

* 26.4 % 23.3 % * 19.2 %

1 unchanged sentence

* Less than 10%

For the year ended December 31, 2022, substantially all of the revenue recorded for BioNTech SE, Pfizer Inc., and CureVac N.V.

was generated by our Nucleic Acid Production segment.

For the year ended December 31, 2021, substantially all of the revenue recorded for BioNTech SE, Pfizer Inc.

and CureVac N.V.

was generated by our Nucleic Acid Production segment.

For the year ended December 31, 2023, all of the revenue recorded for Nacalai USA, Inc.

was generated by the Nucleic Acid Production Segment.

For the year ended December 31, 2022, substantially all of the revenue recorded for BioNTech SE and Pfizer Inc.

was generated by our Nucleic Acid Production segment.

Net Income per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc.

Basic net income per Class A common share/unit attributable to Maravai LifeSciences Holdings, Inc.

is computed by dividing net income attributable to us by the weighted average number of Class A common shares/units outstanding during the period.

The non-controlling interest, for historical periods prior to the IPO, is calculated pursuant to the terms of the MLSC LLC Agreement on a fully-distributed basis, taking into account the various classes of equity of MLSC, including the cumulative yields on MLSC’s preferred units.

Diluted net income per Class A common share/unit is calculated by giving effect to all potential weighted average dilutive LLC incentive units for historical periods prior to the IPO and stock options, restricted stock units, performance stock units and Topco LLC Units, that together with an equal number of shares of our Class B common stock (together referred to as “Paired Interests”) are convertible into shares of our Class A common stock, for the period after the IPO.

For historical periods prior to the IPO, the weighted average number of common units outstanding during the period and the potential dilutive common unit equivalents is determined under the two-class method.

The dilutive effect of outstanding awards, if any, is reflected in diluted earnings per share/unit by application of the treasury stock method or if-converted method, as applicable.

In periods in which the Company reports a net loss attributable to Maravai LifeSciences Holdings, Inc.

diluted net loss per Class A common share/unit attributable to the Company since dilutive equity instruments are not assumed to have been issued if their effect is anti-dilutive.

Recently Adopted Accounting Pronouncements

In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2021-08, Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”), which requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities in accordance with ASC 606, Revenue from Contracts with Customers, as if it had originated the contracts.

This approach differs from the current requirement to measure contract assets and contract liabilities acquired in a business combination at fair value.

ASU 2021-08 is effective for years beginning after December 31, 2022, including interim periods within those fiscal years, with early adoption permitted.

The ASU is to be applied prospectively to business combinations occurring on or after the effective date of its adoption.

The Company early adopted ASU 2021-08, and there was no impact to the Company’s consolidated financial statements as a result of the adoption of this ASU.

In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832) - Disclosures by Business Entities about Government Assistance (“ASU 2021-10”).

ASU 2021-10 provides guidance to increase the transparency of government assistance including the disclosure of:

(i) the types of assistance, (ii) an entity’s accounting for the assistance, and (iii) the effect of the assistance on an entity’s financial statements.

Under the new guidance, an entity is required to provide the following annual disclosures about transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy:

(i) information about the nature of the transactions and the related accounting policy used to account for the transactions, (ii) the line items on the balance sheet and income statement that are affected by the transactions, and the amounts applicable to each financial statement line item, and (iii) significant terms and conditions of the transactions, including commitments and contingencies.

The new guidance is required to be adopted either:

(i) prospectively to all transactions within the scope of the amendments that are reflected in financial statements at the date of initial application and new transactions that are entered into after the date of initial application, or (ii) retrospectively to those transactions.

The Company adopted ASU

2021-10 on January 1, 2022 using the prospective method and is complying with the related disclosure requirements (see Note 6).

For the year ended December 31, 2021, substantially all of the revenue recorded for BioNTech SE, Pfizer Inc and CureVac N.V.

was generated by our Nucleic Acid Production segment.

Net (Loss) Income per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc.

Basic net (loss) income per Class A common share attributable to Maravai LifeSciences Holdings, Inc.

is computed by dividing net (loss) income attributable to us by the weighted average number of Class A common shares outstanding during the period.

Diluted net income per Class A common share is calculated by giving effect to all potential weighted average dilutive stock options, restricted stock units, performance stock units and Topco LLC Units, that together with an equal number of shares of our Class B common stock are convertible into shares of our Class A common stock.

The dilutive effect of outstanding awards, if any, is reflected in diluted earnings per share by application of the treasury stock method or if-converted method, as applicable.

In periods in which the Company reports a net loss attributable to Maravai LifeSciences Holdings, Inc., diluted net loss per Class A common share attributable to the Company is the same as basic net loss per Class A common share attributable to the Company, since dilutive equity instruments are not assumed to have been issued if their effect is anti-dilutive.

The Company reported a net loss attributable to Maravai LifeSciences Holdings, Inc.

for the year ended December 31, 2023.

Recently Adopted Accounting Pronouncements Not Yet Adopted

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which improves segment disclosure requirements, primarily through enhanced disclosures about significant expenses.

ASU 2023-07 requires disclosures to include significant segment expenses that are regularly provided to the CODM and included within each

reported measure of segment profit or loss, an amount for other segment items by reportable segment and a description of its composition, any additional measures of a segment’s profit or loss used by the CODM when deciding how to allocate resources, and the title and position of the CODM and an explanation of how the CODM uses the reported measures of segment profit or loss in assessing segment performance and deciding how to allocate resources.

The ASU also requires all annual disclosures currently required by Topic 280 to be included in interim periods.

ASU 2023-07 is effective for the Company for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

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

The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures (“ASU 2023-09”).

The amendments in this ASU address investor requests for more transparency about income tax information through improvements to tax disclosures primarily related to the rate reconciliation and income taxes paid information.

The ASU also includes certain other amendments to improve the effectiveness of income tax disclosures.

ASU 2023-09 is effective for the Company for annual periods beginning after December 15, 2024, with early adoption permitted.

The amendments in this ASU should be applied on a prospective basis, with retrospective application permitted.

The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements and disclosures.

Acquisitions and Divestiture

Alphazyme, LLC

On January 18, 2023, the Company completed the acquisition of Alphazyme, LLC (“Alphazyme”), a privately-held original equipment manufacturer (“OEM”) and provider of custom, scalable, molecular biology enzymes to customers in the genetic analysis and nucleic acid synthesis markets.

The acquisition will expand the Company’s internal enzyme product portfolio and increase the Company’s differentiated mRNA manufacturing services and product offerings.

Alphazyme’s ability to manufacture custom enzymes allows the Company to expand into near adjacent markets and raise our enzyme vertical.

The Company acquired Alphazyme for a total purchase consideration of $ 75.3 million, which is inclusive of net working capital adjustments.

As a result of the acquisition, the Company owns all the outstanding equity interest in Alphazyme.

The total cash consideration was paid using existing cash on hand.

The transaction was accounted for as an acquisition of a business as Alphazyme consisted of inputs and processes applied to those inputs that had the ability to contribute to the creation of outputs.

For the year ended December 31, 2023, the Company incurred $ 4.1 million in transaction costs associated with the acquisition of Alphazyme, which were recorded within selling, general and administrative expenses in the consolidated statements of operations.

The acquisition date fair value of consideration transferred to acquire Alphazyme consisted of the following (in thousands):

Cash paid (1)

Fair value of contingent consideration 5,289

Total consideration transferred $ 75,326

____________________

(1) Represents cash consideration paid at closing of $ 70.1 million, net of a purchase price adjustment received in June 2023 of $ 0.1 million.

Pursuant to the Securities Purchase Agreement (the “Alphazyme SPA”) between the Company and sellers of Alphazyme, additional payments to the sellers of Alphazyme are dependent upon meeting or exceeding defined revenue targets during fiscal years 2023 through 2025 (the “Alphazyme Performance Payments”).

The Alphazyme SPA provides for a total maximum Alphazyme Performance Payments of $ 75.0 million.

The Alphazyme Performance Payments were recorded as contingent consideration and was included as part of the purchase consideration.

The Company estimated the fair value of the Alphazyme Performance Payments contingent consideration based on a Monte-Carlo simulation model which utilized an income approach.

The estimated fair value was based on Alphazyme revenue projections, expected payout term, volatility and risk adjusted discount rates which are Level 3 inputs (see Note 5).

The first performance period applicable to the Alphazyme Performance Payments ended on December 31, 2023, and it was determined that the defined revenue target was not achieved.

Consequently, no payment was made to the sellers of Alphazyme.

The Alphazyme SPA also provides that the Company will pay certain employees of Alphazyme an additional amount totaling $ 9.3 million (the “Alphazyme Retention Payments”) as of various dates but primarily through December 31, 2025 as long as these individuals continue to be employed by the Company.

The Company considers the payment of the Alphazyme Retention Payments as probable and is recognizing compensation expense related to these payments in the post-acquisition period ratably over the service period of approximately three years .

For the year ended December 31, 2023, the Company recorded $ 2.2 million of compensation expense related to the Alphazyme Retention Payments within selling, general and administrative expenses in the consolidated statements of operations.

Compensation expense related to the Alphazyme Retention Payments recorded within cost of revenue and research and development expenses were not material.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands):

Inventory 7,246

Other current assets 660

Intangible assets, net 31,680

Other assets 5,043

Total identifiable assets acquired 44,917

Current liabilities ( 482 )

Other long-term liabilities ( 11,470 )

Total liabilities assumed ( 11,952 )

Net identifiable assets acquired 32,965

Goodwill 42,361

Net assets acquired $ 75,326

We recorded the preliminary purchase price allocation in the first quarter of 2023.

During the third quarter of 2023, we recorded a measurement period adjustment resulting in a decrease to goodwill of $ 0.4 million, with an equal offset to other long-term liabilities.

The acquisition was accounted for under the acquisition method of accounting, and therefore, the total purchase price was allocated to the identifiable tangible and intangible assets acquired and the liabilities assumed based on their respective fair values as of the acquisition date.

Purchase consideration in excess of the amounts recognized for the net assets acquired was recognized as goodwill.

Goodwill is primarily attributable to expanded synergies expected from the acquisition associated with a vertical supply integration.

All of the goodwill acquired in connection with the acquisition of Alphazyme was allocated to the Company’s Nucleic Acid Production segment.

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

Upon closing of the acquisition, approximately $ 1.5 million was placed into escrow to cover potential working capital adjustments and approximately $ 3.0 million was placed into escrow to secure certain representations and warranties pursuant to the terms of the Alphazyme SPA.

These amounts are included in the total purchase consideration of $ 75.3 million.

The $ 1.5 million was released from escrow during the second quarter of 2023, of which the Company received $ 0.1 million related to net working capital adjustments.

Because the remaining $ 3.0 million held in escrow is not controlled by the Company, this amount is not included in the accompanying consolidated balance sheet as of December 31, 2023.

The following table summarizes the estimated fair values of Alphazyme’s identifiable intangible assets as of the date of acquisition and their estimated useful lives:

Estimated Fair Value

(in thousands) Estimated Useful Life

Trade names $ 220 5

Developed technology 31,000 12

Customer relationships 460 12

Total $ 31,680

The trade name and customer relationship intangible assets are related to Alphazyme’s name, customer loyalty and customer relationships.

The developed technology intangible asset is related to its unique manufacturing process optimization capability to both scale production and achieve quality standards.

The fair value of these intangible assets was based on Alphazyme’s projected revenues and was estimated using an income approach, specifically the relief from royalty method for trade names, the multi-period excess earnings method for developed technology, and the distributor method for customer relationships.

Under the income approach, an intangible asset’s fair value is equal to the present value of future economic benefits to be derived from ownership of the asset.

The estimated fair value was developed by discounting future net cash flows to their present value at market-based rates of return utilizing Level 3 inputs.

The useful lives for these intangible assets were determined based upon the remaining period for which the assets were expected to contribute directly or indirectly to future cash flows.

Key quantitative assumptions used in the determination of fair value of the developed technology intangible included revenue growth rates ranging from 3.0 % to 55.0 %, a discount rate of 17.8 % and an assumed technical obsolescent curve of 5.0 %.

The carrying value of the remaining assets acquired or liabilities assumed was estimated to equal their fair values based on their short-term nature.

These estimates were based on the assumption that the Company believes to be reasonable;

however, actual results may differ from these estimates.

On January 27, 2022, the Company completed the acquisition of MyChem, LLC (“MyChem”), a privately-held San Diego, California-based provider of ultra-pure nucleotides to customers in the diagnostics, pharma, genomics and research markets.

1 unchanged sentence

The Company acquired MyChem for a total purchase consideration of $ 257.9 million, which is inclusive of net working capital adjustments.

As a result of the acquisition, the Company owns all the outstanding equity interest in MyChem.

The total cash consideration was paid using existing cash on hand.

The transaction was accounted for as an acquisition of a business as MyChem consisted of inputs and processes applied to those inputs that had the ability to contribute to the creation of outputs.

For the year ended December 31, 2022, the Company incurred $ 3.5 million in transaction costs associated with the acquisition of MyChem, which were recorded within selling, general and administrative expenses in the consolidated statements of income.

The acquisition date fair value of consideration transferred to acquire MyChem consisted of the following (in thousands):

5 unchanged sentences

(1) Represents cash consideration paid at closing of $ 240.0 million and a purchase price adjustment paid in November 2022 of $ 0.1 million.

Pursuant to the Securities Purchase Agreement (the “MyChem SPA”) between the Company and sellers of MyChem, additional payments to the sellers of MyChem are dependent upon meeting or exceeding defined revenue targets during fiscal 2022 (the “Performance Payment”).

The MyChem SPA provides for a total maximum Performance Payment of $ 40.0 million.

The MyChem SPA also provides that the Company will pay to the sellers of MyChem an additional $ 20.0 million (the “Retention Payment”) as of the second anniversary of the closing of the acquisition date as long as two senior employees who are also the sellers of MyChem continue to be employed by TriLink.

The MyChem Performance Payment was recorded as contingent consideration and was included as part of the purchase consideration.

The Company estimated the fair value of the MyChem Performance Payment contingent consideration based on a Monte-Carlo simulation model which utilized an income approach.

The estimated fair value was based on MyChem revenue projections, expected payout term, volatility and risk adjusted discount rates which are Level 3 inputs (see Note 5).

The performance period applicable to the MyChem Performance Payment ended as of December 31, 2022 and it was determined that none of the defined revenue thresholds were achieved.

Consequently, no payment was made to the sellers of MyChem.

The MyChem SPA also provides that the Company will pay to the sellers of MyChem an additional $ 20.0 million (the “MyChem Retention Payment”) as of the second anniversary of the closing of the acquisition date as long as two senior employees who are also the sellers of MyChem continue to be employed by TriLink.

The Company considers the payment of the Retention Payment as probable and is recognizing compensation expense related to this payment in the post-acquisition period ratably over the expected service period of two years .

For the year ended December 31, 2023, the Company recorded $ 4.3 million of compensation expense related to the MyChem Retention Payment within cost of revenue in the consolidated statements of operations.

For the years ended December 31, 2023 and 2022, the Company recorded $ 5.1 million and $ 9.3

million, respectively, of compensation expense related to the MyChem Retention Payment within research and development expenses in the consolidated statements of operations.

The MyChem SPA further provides that the Company will pay to the sellers of MyChem an additional amount of up to $ 10.0 million subject to the completion of certain calculations associated with acquired inventory, which has been recorded within accrued expenses and other current liabilities on the consolidated balance sheet as of December 31, 2022.

The Performance Payment was recorded as contingent consideration and was included as part of the purchase consideration.

For the year ended December 31, 2022, the Company recorded $ 9.3 million of compensation expense related to the Retention Payment within research and development expenses in the consolidated statements of income.

The Company estimated the fair value of the Performance Payment contingent consideration based on a Monte-Carlo simulation model which utilized an income approach.

The estimated fair value was based on MyChem revenue projections, expected payout term, volatility and risk adjusted discount rates which are Level 3 inputs (see Note 4).

As the Company is in the process of finalizing the evaluation of certain liabilities and assets, the allocation of purchase consideration is preliminary, and provisional measurements of certain liabilities and goodwill are subject to change.

following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands):

During the first quarter of 2023, but subsequent to the end of the measurement period, these calculations were completed and a payment of $ 9.7 million was made by the Company to the sellers.

The remaining $ 0.3 million was recorded as non-cash gain within current year operations.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands):

Current assets 2,741

18 unchanged sentences

The Company released the $ 1.0 million in escrow and paid out an additional $ 0.1 million related to net working capital adjustments during the fourth quarter of 2022.

Because the remaining $ 12.5 million held in escrow is not controlled by the Company, it is not included in the accompanying consolidated balance sheet as of December 31, 2022.

During the first quarter of 2023, but subsequent to the end of the measurement period, $ 12.4 million of the amounts in escrow to secure certain representations and warranties was released to the sellers and the remaining $ 0.1 million was released to the Company for indemnification of pre-closing liabilities, which was recorded within current year operations.

The following table summarizes the estimated fair values of MyChem’s identifiable intangible assets as of the date of acquisition and their estimated useful lives:

14 unchanged sentences

The carrying value of the remaining assets acquired or liabilities assumed was estimated to equal their fair values based on their short-term nature.

These estimates were based on the assumption that the Company believes to be reasonable;

however, actual results may differ from these estimates.

Revenue and earnings from MyChem included in the Company’s consolidated statements of income since the date of acquisition were immaterial.

No proforma revenue or earnings information for the years ended December 31, 2022 and 2021 have been presented as the impact was not determined to be material to the Company’s consolidated revenues and net income for the respective periods.

Mock V Solutions, Inc.

In March 2020, the Company acquired all of the outstanding shares of MockV Solutions, Inc.

(“MockV”), a private entity, for $ 3.0 million, inclusive of acquisition costs of $ 0.2 million.

The MockV technology acquired is a novel, proprietary viral clearance prediction tool that includes a non-infectious “mock virus particle” mimicking the physicochemical properties of live virus that may be present endogenously in the drug substance or introduced during bioproduction and will expand the Company biologics safety testing offerings.

The transaction was accounted for as an asset acquisition as the acquired set of assets and activities did not meet the definition of a business.

In connection with this acquisition, the Company acquired developed technology, an in-process research and development asset (“IPR&D”), an assembled workforce, and an insignificant amount of working capital balances.

The relative fair value attributed to the acquired developed technology, assembled workforce, and working capital balances was insignificant.

The IPR&D acquired was allocated a value of $ 2.9 million and the Company recognized a charge of $ 2.9 million related to the IPR&D as a component of research and development expenses on the consolidated statements of income because the technology had not yet reached technological feasibility and had no alternative future use.

The Company must also make contingent cash payments (the “Earn-Outs”) of up to $ 9.0 million to the sellers of MockV based upon the achievement of long-term revenue targets.

The Earn-Outs were determined to be contingent consideration that was not subject to derivative accounting and will be recognized when the contingency is resolved, and the consideration becomes paid or payable.

As of December 31, 2022 and 2021, no such amounts were deemed to be payable.

As the Company had no tax basis in the acquired IPR&D asset, and the acquired IPR&D asset was expensed prior to the measurement of any deferred taxes, no deferred taxes were recognized for the initial transaction.

In November 2020, MockV was converted into a single member LLC and was deemed liquidated for income tax purposes.

Vector Laboratories, Inc.

3 unchanged sentences

The divestiture was completed in September 2021, and final net proceeds were $ 120.7 million, which were inclusive of working capital adjustments.

As a result of the divestiture, during the year ended December 31, 2021, the Company recognized a pre-tax gain on sale of $ 11.2 million, net of transactions costs of $ 0.9 million, in the consolidated statements of income.

The Company’s Protein Detection segment was comprised of Vector.

4 unchanged sentences

Depending on the service, the initial period ranges from one month to five months and the extension period ranges from one month to eight months .

Income from performing services under the TSA was recorded within other income in the consolidated statements of income and was not significant for the year ended December 31, 2021.

Income from performing services under the TSA was recorded within other income in the consolidated statements of operations and was not significant for the year ended December 31, 2021.

In August 2020, the Company entered into an agreement with an executive of Vector whereby the executive received incentive units of MLSH 1.

In connection with the divestiture, MLSH 1 amended this executive’s incentive units resulting in the

recognition of incremental unit-based compensation expense in the Company’s consolidated financial statements of $ 2.4 million.

This unit-based compensation expense was recorded within selling, general and administrative expenses in the consolidated statements of income for the year ended December 31, 2021.

In connection with the divestiture, MLSH 1 amended this executive’s incentive units resulting in the recognition of incremental unit-based compensation expense in the Company’s consolidated financial statements of $ 2.4 million.

This unit-based compensation expense was recorded within selling, general and administrative expenses in the consolidated statements of operations for the year ended December 31, 2021.

Restructuring

In November 2023, the Company implemented a cost realignment plan (the “Cost Realignment Plan”) that included the termination of approximately 15 % of the Company’s workforce, the termination of certain leases, and other actions to reduce expenses, all as part of a plan to optimize business operations and match them to current market conditions.

The reduction in force was completed on January 5, 2024, following the end of the sixty-day notification period required by the Worker Adjustment and Retraining Notification Act.

The Company expects the remaining actions under the Cost Realignment Plan to be substantially complete during the first quarter of 2024.

The Company’s restructuring charges by segment and unallocated corporate costs, which are recorded as restructuring expenses on the consolidated statements of operations, were as follows for the year ended December 31, 2023 (in thousands):

Severance and Other Employee Costs

Stock-Based Compensation Expense (Benefit)

Facility and Other Exit Costs

Professional Fees and Other

Nucleic Acid Production

$ 2,470 $ 168 $ 638 $ 190 $ 3,466

1,833 ( 269 ) 1,351 85 3,000

$ 4,303 $ ( 101 ) $ 1,989 $ 275 $ 6,466

The following table summarizes the activity for accrued restructuring costs, which is recorded within accrued expenses and other current liabilities on the consolidated balance sheets, for the period presented (in thousands):

Severance and Other Employee Costs

Stock-Based Compensation Expense (Benefit)

Facility and Other Exit Costs

Professional Fees and Other

Balance as of December 31, 2022 $ — $ — $ — $ — $ —

4,303 ( 101 ) 1,989 275 6,466

Non-cash charges

— 101 — — 101

Cash payments

( 1,760 ) — ( 1,989 ) ( 4 ) ( 3,753 )

Balance as of December 31, 2023 $ 2,543 $ — $ — $ 271 $ 2,814

The Company does not expect to incur additional restructuring costs relating to the Cost Realignment Plan, however the Company expects an additional benefit totaling $ 1.2 million for the forfeiture of equity awards upon the termination of certain impacted employees in January 2024, of which $ 0.8 million relates to the Nucleic Acid Production segment and $ 0.4 million relates to unallocated corporate costs.

Goodwill and Intangible Assets

The Company’s goodwill of $ 326.0 million and $ 283.7 million as of December 31, 2023 and 2022, respectively, represents the excess of purchase consideration over the fair value of assets acquired and liabilities assumed.

As of December 31, 2022 and 2021, the Company had three reporting units, two of which are contained in the Nucleic Acid Production segment.

During the year ended December 31, 2022, the Company recorded goodwill of $ 130.9 million in connection with the acquisition of MyChem that was completed in January 2022 (see Note 2).

The Company performed a qualitative goodwill impairment analysis on each of its three reporting units during the fourth quarter of 2022 and concluded that it was more likely than not that the fair value of goodwill exceeded its carrying value and no further testing was required.

As of December 31, 2023, the Company had four reporting units, three of which are contained in the Nucleic Acid Production segment.

During the year ended December 31, 2023, the Company recorded goodwill of $ 42.4 million in connection with the acquisition of Alphazyme that was completed in January 2023 (see Note 2).

As of December 31, 2022, the Company had three reporting units, two of which were contained in the Nucleic Acid Production segment.

Due to the sustained decline in its stock price and the announcement of the Cost Realignment Plan in November 2023, the Company performed a quantitative goodwill impairment analysis on each of its four reporting units during the fourth quarter of 2023 and concluded that the fair value of goodwill exceeded its carrying value.

The Company has not recognized any goodwill impairment charges in any of the periods presented.

The following table summarizes the activity in the Company’s goodwill by segment for the periods presented (in thousands):

The following table summarizes the activity in the Company’s goodwill by segment for the period presented (in thousands):

Nucleic Acid Production Biologics Safety Testing Total

3 unchanged sentences

Intangible assets are being amortized on a straight-line basis, which reflects the expected pattern in which the economic benefits of the intangible assets are being obtained, over an estimated useful life ranging from 3 to 14 years.

The following are components of finite-lived intangible assets and accumulated amortization as of the periods presented:

The following are components of finite-lived intangible assets and accumulated amortization as of the periods presented (in thousands):

December 31, 2023

14 unchanged sentences

Total $ 318,082 $ 101,419 $ 216,663 9.3

During the first quarter of 2022, the Company recorded intangible assets of $ 123.4 million in connection with the acquisition of MyChem that was completed in January 2022 (see Note 2).

The Company recognized $ 21.5 million, $ 12.4 million and $ 12.7 million of amortization expense from intangible assets directly linked with revenue generating activities within cost of revenue in the consolidated statements of income for the years ended December 31, 2022, 2021 and 2020, respectively.

Amortization expense for intangible assets that are not directly related

to sales generating activities of $ 2.8 million, $ 5.9 million and $ 7.6 million was recorded as selling, general and administrative expenses for each of the years ended December 31, 2022, 2021 and 2020, respectively.

During the first quarter of 2023, the Company recorded intangible assets of $ 31.7 million in connection with the acquisition of Alphazyme that was completed in January 2023 (see Note 2).

The Company recognized $ 24.8 million, $ 21.5 million and $ 12.4 million of amortization expense from intangible assets directly linked with revenue generating activities within cost of revenue in the consolidated statements of operations for the years ended December 31, 2023, 2022 and 2021, respectively.

Amortization expense for intangible assets that are not directly related to sales generating activities of $ 2.6 million, $ 2.8 million and $ 5.9 million was recorded as selling, general and administrative expenses for the years ended December 31, 2023, 2022 and 2021, respectively.

As of December 31, 2023, the estimated future amortization expense for finite-lived intangible assets were as follows (in thousands):

3 unchanged sentences

Fair Value Measurements

The following table summarizes the Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy (in thousands):

Fair Value Measurement as of December 31, 2022

The following table summarizes the Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy as of the periods presented (in thousands):

Fair Value Measurements as of December 31, 2023

Level 1 Level 2 Level 3 Total

Money market funds

$ 418,685 $ — $ — $ 418,685

Interest rate cap — 8,559 — 8,559

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2021 were insignificant.

Total assets $ 418,685 $ 8,559 $ — $ 427,244

Current portion of contingent consideration $ — $ — $ 131 $ 131

Contingent consideration, non-current — — 1,872 1,872

Total liabilities $ — $ — $ 2,003 $ 2,003

Fair Value Measurements as of December 31, 2022

Level 1 Level 2 Level 3 Total

Interest rate cap $ — $ 11,362 $ — $ 11,362

Contingent Consideration

In connection with the acquisition of Alphazyme (see Note 2), the Company is required to make contingent payments to the sellers of up to $ 75.0 million, subject to achieving certain revenue thresholds.

The preliminary fair value of the liability for the contingent payments recognized upon the acquisition as part of the purchase accounting opening balance sheet totaled $ 5.3 million.

The preliminary fair value of the contingent consideration was determined using a Monte-Carlo simulation-based model discounted to present value.

Assumptions used in this calculation are expected revenue, a discount rate of 17.8 % and various probability factors.

The ultimate settlement of the contingent consideration could deviate from current estimates based on the actual results of these financial measures.

The contingent consideration has three performance payments spanning over three years beginning 2024.

This liability is considered to be a Level 3 financial liability that is remeasured each reporting period.

Changes in fair value of contingent consideration are recognized as a gain or loss and recorded within change in estimated fair value of contingent consideration in the consolidated statements of operations.

During the year ended December 31, 2023, the Company recorded a decrease of $ 3.3 million in the estimated fair value of contingent consideration.

This was due to a change in estimates associated with Alphazyme revenue projections reaching thresholds that would trigger a contingent payment per the Alphazyme SPA.

In connection with the acquisition of MyChem (see Note 2), the Company is required to make contingent payments to the sellers of up to $ 40.0 million, subject to achieving certain revenue thresholds.

3 unchanged sentences

The ultimate settlement of the contingent consideration could deviate from current estimates based on the actual results of these financial measures.

The contingent consideration projected year of payment is 2023.

The contingent consideration projected year of payment was 2023.

This liability is considered to be a Level 3 financial liability that is remeasured each reporting period.

During the second quarter of 2022, the Company recorded a $ 7.8 million decrease in the estimated fair value of contingent consideration.

This was due to a change in the estimate associated with MyChem revenue projections reaching thresholds that would trigger a contingent payment per the MyChem SPA.

The following table provides a reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the period presented (in thousands):

The contingent consideration expired as of December 31, 2022 and the revenue thresholds were not achieved.

The following table provides a reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the periods presented (in thousands):

Contingent Consideration

3 unchanged sentences

Balance as of December 31, 2022 —

Contingent consideration related to the acquisition of Alphazyme 5,289

Change in estimated fair value of contingent consideration ( 3,286 )

Balance as of December 31, 2023 $ 2,003

Balance Sheet Components

6 unchanged sentences

Property and equipment

Property and equipment consisted of the following as of the periods presented (in thousands):

Property and equipment consist ed of the following as of the periods presented (in thousands):

December 31, 2023 December 31, 2022

Finance lease right-of-use assets

Leasehold improvements 24,874 20,095

9 unchanged sentences

December 31, 2023 December 31, 2022

Right-of-use assets $ 63,896 $ 49,095

Prepaid lease payments 27,253 —

Operating lease right-of-use assets

$ 59,746 $ 63,896

Interest rate cap 8,559 11,362

Indemnification asset (see Note 2)

Prepaid lease payments — 27,253

Other 2,929 5,396

3 unchanged sentences

December 31, 2023 December 31, 2022

Accrued MyChem Retention Payments, current portion (see Note 2)

Employee related 12,905 19,873

Inventory holdback liability 10,000 —

Accrued interest payable 9,202 7,700

Lease liabilities, current portion 6,269 3,722

Operating lease liabilities, current portion

Accrued restructuring costs (see Note 3)

Professional services 2,277 4,093

1 unchanged sentence

Sales and use tax liability 1,001 1,029

Federal tax liability — 102

Inventory holdback liability — 10,000

Other 3,656 2,742

3 unchanged sentences

December 31, 2023 December 31, 2022

Non-current lease liabilities $ 51,556 $ 40,906

Accrued Retention Payments (see Note 2)

Operating lease liabilities, non-current

$ 47,510 $ 51,556

Acquisition related tax liability (see Note 2)

Accrued Alphayzme Retention Payments, non-current (see Note 2)

Contingent consideration, non-current

Accrued MyChem Retention Payments, non-current (see Note 2)

Other 522 413

4 unchanged sentences

Department of Defense, as represented by the Joint Program Executive Office for Chemical, Biological, Radiological and Nuclear Defense on behalf of the Biomedical Advanced Research and Development Authority (“BARDA”), within the U.S.

Department of Health and Human Services, to advance the development of domestic manufacturing capabilities and to expand TriLink’s domestic production capacity in its San Diego manufacturing campus (the “Flanders San Diego Facility”) for products critical to the development and manufacture of mRNA vaccines and therapeutics.

Pursuant to certain requirements, BARDA awarded TriLink an amount equal to $ 38.8 million or 50 % of the construction and validation costs currently budgeted for the Flanders San Diego Facility.

The contract period of performance is May 2022 through December 2023, which is the effective date of the Cooperative Agreement through the anticipated date of completion of construction and validation of manufacturing capacity.

Amounts reimbursed are subject to audit and may be recaptured by the U.S.

Department of Defense in certain circumstances.

Department of Health and Human Services (“HHS”), to advance the development of domestic manufacturing capabilities and to expand TriLink’s domestic production capacity in its San Diego manufacturing campus (the “Flanders San Diego Facility”) for products critical to the development and manufacture of mRNA vaccines and therapeutics.

The Cooperative Agreement has since transitioned from the U.S.

Department of Defense to the HHS as of January 2023.

The Flanders San Diego Facility consists of two buildings (“Flanders I” and “Flanders II”), however, the Cooperative Agreement is exclusively involved in Flanders I.

The Cooperative Agreement requires the Company to provide the U.S.

Government with conditional priority access and certain preferred pricing obligations for a 10-year period from the completion of the construction project for the production of a medical countermeasure (or a component thereof) that the Company manufactures in the Flanders San Diego Facility during a declared public health emergency.

Pursuant to certain requirements, BARDA awarded TriLink an amount equal to $ 38.8 million or 50 % of the construction and validation costs currently budgeted for the Flanders San Diego Facility.

The contract period of performance is May 2022 through January 2034, which is the effective date of the Cooperative Agreement through the anticipated expiration of the 10-year conditional priority access period.

Amounts reimbursed are subject to audit and may be recaptured by the HHS in certain circumstances.

During the year ended December 31, 2023, the Company has received $ 12.9 million of reimbursements under the Cooperative Agreement with an equal offset recorded to property and equipment on the consolidated balance sheet.

As of December 31, 2023, the Company has recorded a receivable of $ 1.1 million, with an equal offset to property and equipment on the consolidated balance sheet.

During the year ended December 31, 2022, the Company has received $ 18.1 million of reimbursements under the Cooperative Agreement, with offsets recorded to:

(i) prepaid lease payments associated with Flanders I (as defined in Note 7) within other assets of $ 17.0 million;

(i) prepaid lease payments associated with Flanders I within other assets of $ 17.0 million;

and (ii) property and equipment of $ 1.1 million.

As of December 31, 2022, the Company has recorded a receivable of $ 8.2 million, with an equal offset recorded to prepaid lease payments associated with Flanders I within other assets on the consolidated balance sheet.

All of the Company's facilities, including office, laboratory and manufacturing space, are occupied under long-term non-cancelable operating lease arrangements with various expiration dates through 2037, some of which include options to extend up to 20 years.

All of the Company's facilities, including office, laboratory and manufacturing space, are occupied under long-term non-cancelable lease arrangements with various expiration dates through 2038, some of which include options to extend up to 20 years.

The Company does not have any leases that include residual value guarantees.

In July 2022, the Company entered into a facility lease agreement for additional office, warehouse and light lab space in San Diego, California.

The lease term began in July 2022 and will end in September 2026.

In December 2022, the Company’s lease for a new manufacturing facility in Leland, North Carolina commenced.

The Company entered into this lease in June 2021 and construction began in November 2021.

The lease is for 10 years with the option to extend for four 5-year periods.

The Company is reasonably certain to execute the first renewal option and has, therefore, recognized this as part of its ROU assets and lease liabilities.

The lease includes tenant improvement provisions, rent abatement, and escalating rent payments over the life of the lease.

The Company did not have any finance leases as of December 31, 2022 or 2021.

The following table presents supplemental balance sheet information related to the Company's operating leases as of the periods presented below (in thousands):

Line Item in the Consolidated Balance Sheet December 31, 2022 December 31, 2021

Right-of-use assets Other assets $ 63,896 $ 49,095

Lease liabilities, current portion Accrued expenses and other current liabilities 6,269 3,722

Non-current lease liabilities Other long-term liabilities 51,556 40,906

The components of the net lease costs reflected in the Company's consolidated statements of income were as follows for the periods presented (in thousands):

In January 2023, the Company assumed Alphazyme’s existing facility lease in Jupiter, Florida, in connection with the acquisition of Alphazyme (see Note 2).

The lease term began in January 2023 and will end in January 2032.

The lease is for 10 years with the option to extend for one additional 5-year period.

In February 2023, the Company entered into an agreement to expand the existing Alphazyme facility lease for additional space.

The lease term will run concurrently with and as part of the initial lease term.

In March 2023 and June 2023, the Company’s leases for Flanders I and Flanders II, respectively, commenced.

The Company entered into the lease agreement in August 2021.

The leases are for eleven years with the option to extend for one additional 5-year period.

The Company is reasonably certain to execute the renewal option and has, therefore, recognized this as part of its ROU assets and lease liabilities.

The lease includes tenant improvement provisions, rent abatement clauses, and escalating rent payments over the life of the lease.

In December 2023, as part of the Cost Realignment Plan, the Company terminated a facility lease in San Diego, California and recorded a non-cash loss for early lease termination in the consolidated statements of operations (see Note 3).

The Company has a $ 0.5 million outstanding letter of credit as security for a lease agreement for a facility in San Diego, California, which reduced the availability of credit under the Revolving Credit Facility (see Note 10).

The following table presents supplemental balance sheet information related to the Company's leases as of the periods presented below (in thousands):

Line Item in the Consolidated Balance Sheets

December 31, 2023 December 31, 2022

Right-of-use assets

Finance leases Property and equipment, net $ 75,382 $ —

Operating leases Other assets 59,746 63,896

Total right-of-use assets $ 135,128 $ 63,896

Current lease liabilities

Finance leases Current portion of finance lease liabilities $ 633 $ —

Operating leases Accrued expenses and other current liabilities 6,780 6,269

Total current lease liabilities $ 7,413 $ 6,269

Non-current lease liabilities

Finance leases Finance lease liabilities, less current portion $ 31,897 $ —

Operating leases Other long-term liabilities 47,510 51,556

Total non-current lease liabilities $ 79,407 $ 51,556

The components of the net lease costs reflected in the Company's consolidated statements of operations were as follows for the periods presented (in thousands):

Year Ended December 31,

2023 2022 2021

Finance lease costs:

Depreciation of leased assets $ 3,217 $ — $ —

Interest on lease liabilities 1,696 — —

Total finance lease costs 4,913 — —

Operating lease costs 12,417 8,800 8,792

1 unchanged sentence

Total lease costs $ 21,270 $ 11,542 $ 10,551

The weighted average remaining lease term and weighted average discount rate related to the Company's ROU assets and lease liabilities for its operating leases were as follows as of the periods presented below:

The weighted average remaining lease term and weighted average discount rate related to the Company's ROU assets and lease liabilities for its leases were as follows as of the periods presented below:

December 31, 2023 December 31, 2022

Weighted average remaining lease term (in years):

Finance leases 14.2 *

Operating leases 7.3 7.9

Weighted average discount rate:

Finance leases 8.4 % *

Operating leases 6.7 % 6.5 %

____________________

* The Company did not have any finance leases as of December 31, 2022.

Supplemental information concerning the cash flow impact arising from the Company's leases recorded in the Company's consolidated statements of cash flows is detailed in the following table for the periods presented (in thousands):

Year Ended December 31,

2023 2022 2021

Cash paid for amounts included in lease liabilities:

Financing cash flows used for finance leases $ 332 $ — $ —

Operating cash flows used for finance leases 1,696 — —

Operating cash flows used for operating leases 10,306 7,049 6,335

Non-cash transactions:

Right-of-use assets obtained in exchange for new finance lease liabilities $ 32,862 $ — $ —

Right-of-use assets obtained in exchange for new operating lease liabilities 3,931 17,513 —

As of December 31, 2023, the Company expects that its future minimum lease payments will become due and payable as follows (in thousands):

Operating Leases

Finance Leases Operating Leases Total

2024 $ 3,327 $ 10,224 $ 13,551

2025 3,427 10,392 13,819

2026 3,530 10,039 13,569

2027 3,636 8,561 12,197

2028 3,745 8,666 12,411

Thereafter 40,357 25,432 65,789

2 unchanged sentences

Total lease liabilities $ 32,530 $ 54,290 $ 86,820

As of December 31, 2022, the Company has entered into $ 37.1 million of contractually binding minimum lease payments for a lease executed but not yet commenced.

This amount is excluded from the above tables and relates to the lease of the Flanders San Diego Facility, which consists of two buildings (“Flanders I” and “Flanders II”).

Commitments and Contingencies

Unconditional Purchase Obligations

In the ordinary course of business, we enter into certain unconditional purchase obligations with our suppliers.

These are agreements to purchase products and services that are enforceable, legally binding, and specify terms that include provisions with respect to quantities, pricing and timing of purchases.

Amounts purchased under these obligations totaled $ 3.0 million for the year ended December 31, 2023.

Such amounts were not material for the years ended December 31, 2022 and 2021.

As of December 31, 2023, future minimum commitments under these obligations totaled $ 3.3 million which relates to the year ending December 31, 2024.

Legal Proceedings

3 unchanged sentences

Indemnification Agreements

In the ordinary course of business, we may provide indemnification of varying scope and terms to vendors, lessors, customers and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties, and losses arising from breach of representations, warranties and covenants to counterparties set forth in agreements with such parties.

from intellectual property infringement claims made by third parties, and losses arising from breach of representations, warranties and covenants to counterparties set forth in agreements with such parties.

We have also agreed to our directors and officers to the maximum extent permitted under applicable state laws pursuant to standard director and officer indemnification agreements and our corporate charter and bylaws.

3 unchanged sentences

Credit Agreement

In October 2020, Maravai Intermediate Holdings, LLC (“Intermediate”), a wholly-owned subsidiary of Topco LLC, along with its subsidiaries Vector, TriLink and Cygnus (together with Intermediate, the “Borrowers”), entered into a credit agreement (as amended, the “Credit Agreement”) to refinance previously existing $ 400.0 million long-term debt with a new $ 780.0 million facility.

The Credit Agreement provides for a $ 600.0 million term loan facility, maturing October 2027 (the “Term Loan”), and a $ 180.0 million revolving credit facility (the “Revolving Credit Facility”).

The Credit Agreement amended and restated the Company’s prior credit agreement as of August 2018 (the “First and Second Lien Credit Agreements”).

In November 2020, the Company repaid $ 50.0 million of principal balance of the First Lien Term Loan using proceeds from the IPO.

In August 2021, in conjunction with the Company’s divestiture of the Protein Detection segment, the Company transferred, per the existing terms of the Credit Agreement, the portion of the Term Loan held by Vector of $ 118.4 million to Intermediate in its entirety.

This amount was not assumed by the counterpart as part of the divestiture of Vector.

Total outstanding debt and loan covenant requirements remained unchanged as a result of the divestiture.

In January 2022, the Company entered into an amendment (the “Amendment”) to the Credit Agreement to:

(i) refinance $ 544.0 million in aggregate principal amount of first lien term loans initially issued thereunder (the “First Lien Term Loan”) and to replace it with a Tranche B Term Loan (the “Tranche B Term Loan”);

(ii) replace the London Interbank Offered Rate (“LIBOR”) based interest rate with a Term Secured Overnight Financing Rate (“SOFR”) based rate;

and (iii) reduce the interest rate margins applicable to the Term Loan and Revolving Credit Facility under the Credit Agreement.

The previous interest rate margin on the facilities was, with respect to each LIBOR-based loan, 3.75 % to 4.25 % and, with respect to each base rate-based loan, 2.75 % to 3.25 % (depending, in each case, on consolidated first lien leverage).

Following the Amendment, the interest rate margin on the facilities is 3.00 %, with respect to each Term SOFR-based loan, and 2.00 %, with respect to each base rate-based loan.

Further, the Amendment reduces the base rate floor for the term loans from 2.00 % to 1.50 %, sets the floor for Term SOFR-based term loans at 0.50 % and sets the floor for Term SOFR-based revolving loans at 0.00 %.

No other significant terms under the Credit Agreement were changed in connection with the Amendment.

In October 2020, Maravai Intermediate Holdings, LLC (“Intermediate”), a wholly-owned subsidiary of Topco LLC, along with certain of its subsidiaries (together with Intermediate, the “Borrowers”), entered into a credit agreement (as amended, the “Credit Agreement”), which provides for a term loan facility and a revolving credit facility.

In January 2022, the Company entered into an amendment (the “Amendment”) to refinance the term loan and to replace London Interbank Offered Rate (“LIBOR”) with a Term Secured Overnight Financing Rate (“SOFR”) based rate.

As amended, the Credit Agreement provides for a $ 600.0 million term loan facility, maturing October 2027 (the “Tranche B Term Loan”), and a $ 180.0 million revolving credit facility (the “Revolving Credit Facility”).

The interest rate margins applicable to the Tranche B Term Loan and Revolving Credit Facility is 3.00 %, with respect to each Term SOFR-based loan, and 2.00 %, with respect to each Base Rate-based loan.

Further, the interest rate floor for Base Rate term loans, Term SOFR-based term loans, and Term SOFR-based revolving loans are 1.50 %, 0.50 % and 0.00 %, respectively.

As of December 31, 2023, the interest rate on the Tranche B Term Loan was 8.40 % per annum.

The Credit Agreement also provides for a $ 20.0 million limit for letters of credit, which remained unused as of December 31, 2022.

The Credit Agreement also provides for a $ 20.0 million limit for letters of credit.

As of December 31, 2023, the Company had a $ 0.5 million outstanding letter of credit as security for a lease agreement, which reduced the availability of credit under the Revolving Credit Facility by $ 0.5 million.

Borrowings under the Credit Agreement are unconditionally guaranteed by Topco LLC, together with the existing and future material domestic subsidiaries of Topco LLC (subject to certain exceptions), as specified in the respective guaranty agreements.

Borrowings under the Credit Agreement are also secured by a first-priority lien and security interest in substantially all of the assets (subject to certain exceptions) of existing and future material domestic subsidiaries of Topco LLC that are loan parties.

The accounting related to entering into the Credit Agreement in October 2020 and using the proceeds to pay off the First and Second Lien Credit Agreements were evaluated on a creditor-by-creditor basis to determine whether each transaction should be accounted for as a modification or extinguishment.

Certain creditors under the First and Second Lien Credit Agreements did not participate in this refinancing transaction and ceased being creditors of the Company and the repayment of their related outstanding debt balances has been accounted for as an extinguishment of debt.

Proceeds of borrowings from new lenders were accounted for as a new debt financing.

The Company recorded a loss on extinguishment of debt of $ 7.6 million in the accompanying consolidated statements of income for the year ended December 31, 2020.

For the remainder of the creditors, this transaction was accounted for as a modification because the present value of cash flows between the two term loans before and after the transaction was less than 10% on a creditor-by-creditor basis.

As part of the refinancing, the Company incurred $ 15.8 million of various costs, of which $ 6.0 million related to an original issuance discount, and were all capitalized in the accompanying balance sheet within long-term debt, and are subject to amortization over the term of the refinanced debt as an adjustment to interest expense using the effective interest method.

The accounting related to entering into the Amendment in January 2022 was evaluated on a creditor-by-creditor basis to determine whether each transaction should be accounted for as a modification or extinguishment.

Certain creditors under the First Lien Term Loan did not participate in this refinancing transaction, were repaid their principal and interest of $ 8.5 million and ceased being creditors of the Company and the repayment of their related outstanding debt balances has been accounted for as an extinguishment of debt.

The accounting related to entering into the Amendment was evaluated on a creditor-by-creditor basis to determine whether each transaction should be accounted for as a modification or extinguishment.

Certain creditors under the Tranche B Term Loan did not participate in this refinancing transaction, were repaid their principal and interest of $ 8.5 million and ceased being creditors of the Company and the repayment of their related outstanding debt balances has been accounted for as an extinguishment of debt.

Proceeds of borrowings from new lenders of $ 8.5 million were accounted for as a new debt financing.

The Company recorded a loss on extinguishment of debt of $ 0.2 million in the accompanying consolidated statements of income during the year ended December 31, 2022.

The Company recorded a loss on extinguishment of debt of $ 0.2 million in the accompanying consolidated statements of operations during the year ended December 31, 2022.

For the remainder of the creditors, this transaction was accounted for as a modification because the change in present value of cash flows between the two term loans before and after the transaction was less than 10% on a creditor-by-creditor basis.

As part of the refinancing, the Company incurred $ 0.9 million of various costs, of which an insignificant amount was related to an original issuance discount, and were all capitalized in the accompanying balance sheet within long-term debt and are subject to amortization over the term of the refinanced debt as an adjustment to interest expense using the effective interest method.

We also incurred $ 3.5 million and $ 0.3 million of financing-related fees related to the Revolving Credit Facility in connection with the debt refinancing activities in October 2020 and January 2022, respectively.

We also incurred $ 0.3 million of financing-related fees related to the Revolving Credit Facility in connection with the debt refinancing activities in January 2022.

As of December 31, 2023, unamortized debt issuance costs totaled $ 1.4 million and are recorded as assets within other assets on the accompanying consolidated balance sheet as there is no balance outstanding related to the Revolving Credit Facility.

Commencing with the fiscal year ended December 31, 2021, and each fiscal year thereafter, the Credit Agreement requires mandatory prepayments on the Term Loan principal upon certain excess cash flow, subject to certain step-downs based on the Company’s first lien net leverage ratio.

The excess cash flow shall be reduced to 25 % or 0 % if the first lien net leverage ratio was equal to or less than 4.75 :1.00 or 4.25 :1.00, respectively, however, no prepayment shall be required to the extent excess cash flow calculated for such period is equal to or less than $ 10.0 million.

As of December 31, 2022, our first lien net leverage ratio was less than 4.25 :1.00.

Thus, a prepayment provision was not required.

The Tranche B Term Loan became repayable in quarterly payments of $ 1.4 million beginning in March 2022, with all remaining outstanding principal due in October 2027.

The Tranche B Term Loan includes prepayment provisions that allow the

Company, at our option, to repay all or a portion of the principal amount at any time.

Commencing with the fiscal year ended December 31, 2021, and each fiscal year thereafter, the Credit Agreement requires that we make mandatory prepayments on the Tranche B Term Loan principal upon certain excess cash flow, subject to certain step-downs based on the Company’s first lien net leverage ratio.

The excess cash flow shall be reduced to 25 % or 0 % of the calculated excess cash flow if the Company’s first lien net leverage ratio was equal to or less than 4.75 :1.00 or 4.25 :1.00, respectively, however, no prepayment shall be required to the extent excess cash flow calculated for the respective period is equal to or less than $ 10.0 million.

As of December 31, 2023, the Company’s first lien net leverage ratio was less than 4.25 :1.00.

Thus, a mandatory prepayment on the Tranche B Term Loan out of our excess cash flow was not required.

The Tranche B Term Loan is repayable in quarterly payments of $ 1.4 million which began in March 2022, with all remaining outstanding principal due in October 2027.

The Tranche B Term Loan includes prepayment provisions that allow the Company,

at our option, to repay all or a portion of the principal amount at any time.

The Revolving Credit Facility allows the Company to repay and borrow from time to time until October 2025, at which time all amounts borrowed must be repaid.

3 unchanged sentences

The Credit Agreement contains certain covenants, including, among other things, covenants limiting our ability to incur or prepay certain indebtedness, pay dividends or distributions, dispose of assets, engage in mergers and consolidations, make acquisitions or other investments and make changes to the nature of the business.

Additionally, the Credit Agreement also requires us to maintain a certain net leverage ratio.

Additionally, the Credit Agreement also requires us to maintain a certain net leverage ratio if the outstanding debt balance on the Revolving Credit Facility exceeds 35.0 % of the aggregate amount of available credit of $ 180.0 million.

The Company was in compliance with these covenants as of December 31, 2023.

First and Second Lien Credit Agreements

In August 2018, Intermediate, along with its subsidiaries, entered into a first lien credit agreement (the “First Lien Credit Agreement”) with leading institutions for term loan borrowings (the “First Lien Term Loan”) totaling $ 250.0 million and a second lien credit agreement (the “Second Lien Credit Agreement”) for term loan borrowings (the “Second Lien Term Loan”) totaling $ 100.0 million, to refinance a combined debt agreement entered into in 2017, including repayment of all outstanding senior secured credit facilities and senior subordinated notes outstanding and to allow for a $ 52.0 million distribution to our members.

The First Lien Credit Agreement also provided for a revolving credit facility (the “Revolving Credit Facility”) of $ 50.0 million for letters of credit and loans to be used for working capital and other general corporate financing purposes, of which $ 15.0 million was drawn down in March 2020 to provide financing for the acquisition of MockV and other operating uses.

Borrowings under the First Lien Credit Agreement and the Second Lien Credit Agreement were unconditionally guaranteed by Topco LLC and the existing and future material domestic subsidiaries of Topco LLC (subject to certain exceptions as specified in the respective guaranty agreements, and are secured by a lien and security interest in substantially all of the assets of existing and future material domestic subsidiaries of Topco LLC that are loan parties).

The refinancing of the previous debt was accounted for as a modification and also as an extinguishment of the related outstanding debt balances.

Borrowings under the First Lien Credit Agreement bore interest at variable rates as defined in the respective agreements that could be elected at our option.

Accrued interest under the First Lien Credit Agreement was generally payable quarterly in arrears on the date of any repayment or prepayment and at maturity.

An annual commitment fee was applied to the daily unutilized amount under the Revolving Credit Facility at 0.50 % per annum, with one stepdown to 0.375 % per annum based on Intermediate’s first lien net leverage ratio calculation.

Interest Rate Cap

6 unchanged sentences

Premiums paid to amend the interest rate cap agreement were immaterial.

The interest rate cap agreement has not been designated as a hedging relationship and has been recognized on the consolidated balance sheet at fair value of $ 11.4 million within other assets with changes in fair value recognized within interest expense in the consolidated statements of income.

The interest rate cap agreement has not been designated as a hedging relationship and has been recognized on the consolidated balance sheet at fair value of $ 8.6 million within other assets with changes in fair value recognized within interest expense in the consolidated statements of operations.

Proceeds from the interest rate cap agreement are reflected in cash flows used in financing activities in the consolidated statements of cash flows.

The Company’s long-term debt consisted of the following as of the periods presented (in thousands):

1 unchanged sentence

Tranche B Term Loan $ 533,120 $ 538,560

First Lien Term Loan — 544,000

Unamortized debt issuance costs ( 8,973 ) ( 11,123 )

2 unchanged sentences

Total long-term debt, less current portion $ 518,707 $ 521,997

There were no balances outstanding on the Company’s Revolving Credit Facility as of December 31, 2022.

As of December 31, 2022, the aggregate future principal maturities of the Company’s debt obligations for each of the next five years, based on contractual due dates, were as follows (in thousands):

There were no balances outstanding on the Company’s Revolving Credit Facility as of December 31, 2023 and 2022.

As of December 31, 2023, the aggregate future principal maturities of the Company’s debt obligations based on contractual due dates were as follows (in thousands):

Total long-term debt $ 533,120

Stockholders’ / Member’s Equity

Initial Public Offering

In November 2020, the Company completed its IPO and sold 69,000,000 shares of Class A common stock at a public offering price of $ 27.00 per share, inclusive of the 9,000,000 shares of Class A common stock purchased by underwriters pursuant to the underwriters’ option to purchase additional shares at the initial public offering price, less underwriting discounts and commissions.

The Company received net proceeds from the IPO of approximately $ 1.8 billion after deducting underwriting discounts and commissions, which was used to purchase 55,823,011 of previously-issued and 3,703,704 of newly-issued Topco LLC Units for approximately $ 94.5 million.

Immediately prior to, and in connection with, the completion of our IPO, the Company completed a series of organizational transactions (“Organizational Transactions”), including:

• The amendment and restatement of Topco LLC’s operating agreement (the “New LLC Operating Agreement”) to, among other things, (i) modify Topco LLC’s capital structure by replacing the membership interests held by Topco LLC’s existing owners with a new class of Topco LLC units (the “LLC Units”) and (ii) appoint the Company as the sole managing member of Topco LLC.

• Amend and restate the Company’s certificate of incorporation to among other things, authorize the Company to issue two classes of common stock:

Class A common stock and Class B common stock.

• The issuance of shares of the Company’s Class B common stock to Maravai Life Sciences Holdings, LLC (“MLSH 1”) which was Topco LLC’s pre-IPO owner on a one -to-one basis with the number of LLC Units owned;

• The acquisition, by merger, of two members of Topco LLC (“the Blocker Entities”), for which we issued 28,965,664 shares of Class A common stock and paid cash of $ 208.1 million as consideration (“the Blocker Mergers”).

Prior to the Organizational Transactions, Topco LLC had established a single class of common units with MLSH 1 as its sole member.

Topco LLC was authorized to issue up to 253,916,941 common units.

All authorized 253,916,941 common units were issued and outstanding prior to the Organizational Transactions.

MLSH 1 as the member, was not obligated to make capital contributions to Topco LLC.

Topco LLC’s profits and losses were allocated to MLSH 1 as determined by the Board of Directors.

Topco LLC’s common units have no conversion rights, special preferences or redemption rights.

Prior to the Organizational Transactions, a distribution was made by Topco LLC to MLSH 1 in the amount of $ 88.6 million, with a subsequent distribution of $ 8.2 million in December 2020, totaling $ 96.7 million of distributions for the year ended December 31, 2020.

Stockholders’ Equity

Amendment and Restatement of Certificate of Incorporation

In connection with the Organizational Transactions, the Company’s certificate of incorporation was amended and restated to, among other things, provide for the (i) authorization of 500,000,000 shares of Class A common stock with a par value of $ 0.01 per share;

In November 2020, in connection with the Organizational Transactions, the Company’s certificate of incorporation was amended and restated to, among other things, provide for the (i) authorization of 500,000,000 shares of Class A common stock with a par value of $ 0.01 per share;

(ii) authorization of 300,000,000 shares of Class B common stock with a par value of $ 0.01 per share;

10 unchanged sentences

All Class B common stock that is transferred shall be automatically retired and cancelled and shall no longer be outstanding.

In November 2020, we received $ 1.7 million from MLSH 1 for the issuance of 168,654,981 shares of Class B common stock.

Recapitalization of Topco LLC

Topco LLC’s Board of Directors adopted the amended and restated Topco LLC’s operating agreement in November 2020 to, among other things, appoint us as Topco LLC’s sole managing member and to provide that Topco LLC’s members would not have voting rights or any other control or authority over Topco LLC or its business.

The amended and restated operating agreement also revised the tax rate applicable to the tax distributions that Topco LLC is required to make to the holders of LLC Units, including us, as described in Note 14.

Blocker Mergers

Pursuant to the Blocker Mergers, we acquired the Blocker Entities (together with 37,119,801 LLC Units held by the Blocker Entities), by merger, from MLSH 2.

We issued an aggregate of 28,965,664 shares of Class A common stock and paid $ 208.1 million in cash to MLSH 2 in consideration of the Blocker Mergers.

Upon consummation of the Blocker Mergers, we recognized the acquired LLC Units at carrying value, as these transactions are considered to be between entities under common control.

There were no tax attributes acquired from the Blocker Entities as they had been fully utilized prior to the mergers.

Repurchase of Class A Common Stock From MLSH 2

In November 2020, we repurchased 1,319,148 shares of Class A common stock from MLSH 2, a related party, for $ 33.7 million.

These shares were immediately retired.

Exchanges and Secondary Offerings

April 2021 Exchange and Secondary Offering

In April 2021, MLSH 1 executed an exchange of 17,665,959 LLC Units (paired with the corresponding shares of Class B common stock) in return for 17,665,959 shares of the Company’s Class A common stock.

In April 2021, MLSH 1 executed an exchange of 17,665,959 Topco LLC units (the “LLC Units”) (paired with the corresponding shares of Class B common stock) in return for 17,665,959 shares of the Company’s Class A common stock.

The corresponding shares of Class B common stock were subsequently cancelled and retired.

The Company immediately completed a secondary offering (“April 2021 Secondary Offering”) of 20,700,000 shares of its Class A common stock by MLSH 1 and MLSH 2, which included 3,034,041 shares of Class A common stock previously held by MLSH 2, which included the full exercise of the underwriters’ option to purchase up to 2,700,000 additional shares of Class A common stock, at a price of $ 31.25 per share.

The Company immediately completed a secondary offering (“April 2021 Secondary Offering”) of 20,700,000 shares of its Class A common stock by MLSH 1 and Maravai Life Sciences Holdings 2, LLC (“MLSH 2”), which included 3,034,041 shares of Class A common stock previously held by MLSH 2, which included the full exercise of the underwriters’ option to purchase up to 2,700,000 additional shares of Class A common stock, at a price of $ 31.25 per share.

The selling stockholders were responsible for the underwriting discounts and commissions of the April 2021 Secondary Offering and received all of the net proceeds of $ 624.2 million from the sale of shares of Class A common stock.

The Company was responsible for the offering costs associated with the April 2021 Secondary Offering of $ 1.0 million which were recorded within selling, general and administrative expenses in the consolidated statements of income.

September 2021 Exchange and Secondary Offering

3 unchanged sentences

The selling stockholders were responsible for the underwriting discounts and commissions of the September 2021 Secondary Offering and received all of the net proceeds of $ 977.5 million from the sale of shares of Class A common stock.

The Company was responsible for the offering costs associated with the September 2021 Secondary Offering of $ 0.9 million which were recorded within selling, general and administrative expenses in the consolidated statements of income.

Cash Contribution, Exchange, and Forfeiture Agreement

In December 2021, the Company entered into a Cash Contribution, Exchange and Forfeiture Agreement (the “Contribution Agreement”) with Topco LLC and MLSH 1, a related party.

Pursuant to the Contribution Agreement, the Company contributed $ 110.0 million of cash to Topco LLC in exchange for 2,732,919 newly-issued units LLC Units of Topco LLC at a price per unit of $ 40.25 , which was equal to the 50-day volume-weighted average price of the Company’s Class A common stock as calculated on December 31, 2021.

calculated on December 31, 2021.

Immediately following the contribution, the Company and MLSH 1 agreed to forfeit 2.036 % of their respective LLC Units of Topco LLC and an equal number of shares of the Company’s Class B common stock, par value $ 0.01 per share, for no consideration.

The purpose of the Contribution Agreement was to reduce the excess cash that had accumulated at the Company as a result of quarterly tax distributions it has received from Topco LLC since its IPO.

Net Income Per Class A Common Share/Unit Attributable to Maravai LifeSciences Holdings, Inc.

Net income per unit for periods prior to our IPO have not been retrospectively adjusted to give effect to the Organizational Transactions described in Note 10 and the 69,000,000 shares of Class A common stock sold in our IPO.

Additionally, basic net income per Class A common stock for the year ended December 31, 2020, has been calculated by dividing net income for the period, adjusted for preferred unit dividends attributable to MLSC non-controlling interests and net income (loss) attributable to non-controlling interests, by the weighted average Class A common stock outstanding during the period.

Basic net income per Class A common stock for the years ended December 31, 2022 and 2021, have been calculated by dividing net income for the period, adjusted for net income attributable to non-controlling interests, by the weighted average Class A common stock outstanding during the period.

Diluted net income per Class A common share/unit gives effect to potentially dilutive securities by application of the treasury stock method or if-converted method, as applicable.

Diluted net income per share of Class A common stock attributable to the Company is computed by adjusting the net income and the weighted-average number of shares of Class A common stock outstanding to give effect to potentially diluted securities.

Prior to the Organizational Transactions, the members’ equity of MLSC was comprised of Class A and Class B preferred units, MLSC Incentive Units and MLSC common units, each with participation rights.

The MLSC preferred units were entitled to cumulative dividends of 8.0 % compounded annually, up to an additional 4.0 %, also compounded annually, to the extent of remaining unallocated earnings.

The preferred unitholders of MLSC were required, however, to share a portion of the additional 4.0 % in dividends with the holders of MLSC Incentive Units based on a formula defined in the MLSC LLC Agreement.

The Company determined that vested MLSC Incentive Units and MLSC Class A and B preferred units were participating securities under the two-class method at the MLSC subsidiary level, however, they do not have a contractual obligation to share in losses, and therefore no undistributed losses have been allocated to them.

MLSH 1 Incentive Units are granted by the parent of the Company, and as a result, do not represent potential common units of the Company.

In September 2020, the Company entered into a Sale and Rollover Agreement and repurchased a majority of the outstanding MLSC Class B preferred units as well as entering into an agreement that resulted in an exchange of the remaining MLSC Class B preferred units and MLSC common units into 69,599 of MLSH 1 common units in November 2020 upon the IPO.

Included in the preferred unit dividends attributable to non-controlling interests line item for the year ended December 31, 2020, is a $ 10.2 million deemed dividend representing the excess of the fair value of the Class B preferred units, determined as of the date of the Sale and Rollover Agreement, over their related carrying value.

In September 2020, the Company also agreed and subsequently repurchased all MLSC Incentive Units, however, such incentive units remained outstanding until October 2020, and had the potential to be dilutive to earnings per unit until they were repurchased.

The following table presents the computation of basic and diluted net income per common share/unit attributable to the Company for the periods presented (in thousands, except per share and per unit amounts):

Structuring Transactions

In connection with the Company’s acquisition of Alphazyme (see Note 2), the Company undertook a series of structuring transactions (the “Structuring Transactions”), including:

• On January 18, 2023, the Company acquired all of the outstanding membership interests in Alphazyme (see Note 2).

• On January 19, 2023, the Company entered into a contribution agreement (the “Contribution Agreement”) with Alphazyme Holdings, Inc.

(“Alphazyme Holdings”), a wholly owned subsidiary of the Company, pursuant to which the Company contributed all such membership interests in Alphazyme (the “Alphazyme Membership Interest”) to Alphazyme Holdings.

• On January 22, 2023, Alphazyme Holdings entered into a contribution and exchange agreement (the “Contribution and Exchange Agreement”) with Topco LLC, pursuant to which it contributed all of the Alphazyme Membership Interests to TopCo LLC in exchange for 5,059,134 newly-issued LLC Units of Topco LLC at a price per unit of $ 13.87 , which was equal to the 50-day volume-weighted average price of the Company’s Class A common stock as calculated on January 18, 2023 (the “Contribution and Exchange”).

• Immediately following the Contribution and Exchange, the Company entered into a forfeiture agreement (the “Forfeiture Agreement”) with Alphazyme Holdings, TopCo LLC and MLSH 1, a related party, pursuant to which each of the Company (together with Alphazyme Holdings) and MLSH 1 agreed to forfeit 5,059,134 and 4,871,970 LLC Units, respectively, representing 3.7 % of the Company’s (together with Alphazyme Holdings) and MLSH 1’s respective LLC Units of Topco LLC, and an equal number of shares of the Company’s Class B common stock, par value $ 0.01 per share, were forfeited by MLSH 1, in each case for no consideration.

These were considered transactions between entities under common control.

As a result, the consolidated financial statements for periods prior to the these transactions have been adjusted to combine the previously separate entities for presentation purposes.

Net (Loss) Income Per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc.

Basic net (loss) income per Class A common share has been calculated by dividing net (loss) income for the period, adjusted for net (loss) income attributable to non-controlling interests, by the weighted average number of Class A common shares outstanding during the period.

Diluted net (loss) income per Class A common share gives effect to potentially dilutive securities by application of the treasury stock method or if-converted method, as applicable.

Diluted net (loss) income per Class A common share attributable to the Company is computed by adjusting the net (loss) income and the weighted average number of Class A common shares outstanding to give effect to potentially diluted securities.

The Company reported a net loss attributable to Maravai LifeSciences Holdings, Inc.

for the year ended December 31, 2023.

The following table presents the computation of basic and diluted net (loss) income per common share attributable to the Company for the periods presented (in thousands, except per share amounts):

Year Ended December 31,

2023 2022 2021

Net income $ 490,663 $ 469,250 $ 78,816

preferred unit dividends attributable to the MLSC non-controlling interests — — ( 15,270 )

(income) loss attributable to common non-controlling interests ( 270,458 ) ( 287,213 ) 13,342

Net income attributable to Maravai LifeSciences Holdings, Inc.—basic 220,205 182,037 76,888

Net income (loss) effect of dilutive securities:

Net (loss) income

$ ( 138,375 ) $ 490,663 $ 469,250

loss (income) attributable to common non-controlling interests

19,346 ( 270,458 ) ( 287,213 )

Net (loss) income attributable to Maravai LifeSciences Holdings, Inc.—basic

( 119,029 ) 220,205 182,037

Net (loss) income effect of dilutive securities:

Effect of dilutive employee stock purchase plan, RSUs and options $ — 87 132

Effect of the assumed conversion of Class B common stock — 205,984 220,187

Net income attributable to Maravai LifeSciences Holdings, Inc.—diluted $ 426,276 $ 402,356 $ 68,086

Weighted average Class A common shares/units outstanding—basic 131,545 114,791 10,351

Net (loss) income attributable to Maravai LifeSciences Holdings, Inc.—diluted

$ ( 119,029 ) $ 426,276 $ 402,356

Weighted average Class A common shares outstanding—basic

131,919 131,545 114,791

Weighted average effect of dilutive securities:

1 unchanged sentence

Effect of the assumed conversion of Class B common stock — 123,669 142,859

Weighted average Class A common shares/units outstanding—diluted 255,323 257,803 28,908

Net income per Class A common share/unit attributable to Maravai LifeSciences Holdings, Inc.:

Weighted average Class A common shares outstanding—diluted

131,919 255,323 257,803

Net (loss) income per Class A common share attributable to Maravai LifeSciences Holdings, Inc.:

Basic $ ( 0.90 ) $ 1.67 $ 1.59

1 unchanged sentence

Shares of Class B common stock do not share in the earnings or losses of the Company, and are therefore not participating securities.

As such, a separate presentation of basic and diluted net income per share for Class B common stock under the two-class method has not been presented.

The following table presents potentially dilutive securities excluded from the computation of diluted net income per share/unit for the periods presented because their effect would have been anti-dilutive for the periods presented (in thousands):

As such, a separate presentation of basic and diluted net (loss) income per share for Class B common stock under the two-class method has not been presented.

The following table presents potentially dilutive securities excluded from the computation of diluted net (loss) income per share for the periods presented because their effect would have been anti-dilutive for the periods presented (in thousands):

Year Ended December 31,

3 unchanged sentences

Shares estimated to be purchased under employee stock purchase plan — 13 12

Shares of Class B common stock 119,094 — —

Total 126,521 2,856 367

Shares underlying contingently issuable awards that have not met the necessary conditions as of the end of a reporting period are not included in the calculation of diluted net income per share of Class A common stock attributable to the Company for that period.

The Company had contingently issuable PSUs outstanding that did not meet the market conditions as of December 31, 2022 and, therefore, were excluded from the calculation of diluted net income per share of Class A common stock attributable to the Company.

The maximum number of potentially dilutive shares that could be issued upon vesting for such awards was insignificant as of December 31, 2022.

Shares underlying contingently issuable awards that have not met the necessary conditions as of the end of a reporting period are not included in the calculation of diluted net (loss) income per Class A common share attributable to the Company for that period.

The Company had contingently issuable PSUs outstanding that did not meet the market and performance conditions as of December 31, 2023 and 2022 and, therefore, were excluded from the calculation of diluted net (loss) income per Class A common share attributable to the Company.

The maximum number of potentially dilutive shares that could be issued upon vesting for such awards was insignificant as of December 31, 2023 and 2022.

These amounts were also excluded from the potentially dilutive securities in the table above.

The Company had no contingently issuable PSUs outstanding as of December 31, 2021 or 2020.

The Company had no contingently issuable PSUs outstanding as of December 31, 2021.

Equity Incentive Plans

11 unchanged sentences

Compensation expense recognized for the ESPP was insignificant for all periods presented.

In October 2022, the Company issued PSUs to an executive employee under the 2020 Plan.

The PSUs vest only if the executive employee satisfies a service-based vesting condition and market condition.

The Company began issuing PSUs during 2022 to certain executive employees under the 2020 Plan.

Certain PSUs vest only if the executive employee satisfies a service-based vesting condition and market condition.

The executive employee must remain employed through the third anniversary of the grant date.

The award is eligible to vest based on the achievement of certain price targets of the Company’s stock price over a defined performance period.

Compensation expense recognized for these PSUs was insignificant for the year ended December 31, 2022.

There was no compensation expense related to PSUs during the years ended December 31, 2021 or 2020.

Certain other PSUs are subject to a performance condition being satisfied.

The award is eligible to vest upon achievement of certain revenue-based performance goals and are subject to continued service over a defined performance period.

Compensation expense recognized for these PSUs were insignificant for the years ended December 31, 2023 and 2022.

There was no compensation expense related to PSUs during the year ended December 31, 2021.

Stock Options

6 unchanged sentences

Granted 2,270 14.76

Exercised ( 4 ) 26.08

Cancelled ( 858 ) 25.11

3 unchanged sentences

The assumptions and estimates are as follows:

• Expected term - The expected term represents the period that stock-based awards are expected to be outstanding.

• Expected term - The expected term represents the period that stock-based awards are expected to be outstanding and is determined using the simplified method.

Our historical share option exercise information is limited due to a lack of sufficient data points and does not provide a reasonable basis upon which to estimate an expected term.

12 unchanged sentences

Stock-based compensation expense related to stock options was $ 11.5 million, $ 8.1 million and $ 4.6 million for the years ended December 31, 2023, 2022 and 2021, respectively.

The total fair value of stock options vested was $ 7.7 million and $ 4.3 million for the years ended December 31, 2022 and 2021, respectively.

The total fair value of stock options vested was $ 11.9 million, $ 7.7 million and $ 4.3 million for the years ended December 31, 2023, 2022 and 2021, respectively.

As of December 31, 2023, the total unrecognized stock-based compensation related to stock options was $ 26.3 million, which is expected be recognized over a weighted-average period of approximately 2.7 years.

Restricted Stock Units

The Company has granted restricted stock unit awards to employees and non-employee directors.

The Company has granted restricted stock unit awards to employees and non-employee directors and contractors.

The following table summarizes information related to RSUs:

7 unchanged sentences

Stock-based compensation expense related to RSUs was $ 20.2 million, $ 8.2 million and $ 0.8 million for the years ended December 31, 2023, 2022 and 2021, respectively.

The total fair value of RSUs vested was $ 1.0 million and $ 0.9 million for the years ended December 31, 2022 and 2021, respectively.

The total fair value of RSUs vested was $ 5.0 million, $ 1.0 million and $0.9 million for the years ended December 31, 2023, 2022 and 2021, respectively.

As of December 31, 2023, the total unrecognized equity-based compensation related to RSUs was $ 43.7 million, which is expected be recognized over a weighted-average period of approximately 2.0 years.

1 unchanged sentence

Prior to the IPO, the Company’s parent, MLSH 1, granted unit-based awards (“MLSH 1 Incentive Units”) to certain executives of the Company in the form of non-vested units.

Our controlled subsidiary, MLSC, granted unit-based awards (“MLSC Incentive Units”) only to certain employees of its subsidiaries.

MLSC Incentive Units

Topco LLC’s majority-owned subsidiary during the periods preceding the Organizational Transactions and wholly-owned subsidiary subsequent to the Organizational Transactions, issued incentive units (the “MLSC Incentive Units”) to its employees.

All MLSC Incentive Units were settled during 2020.

The MLSC Incentive Units were subject to either a combination of service, market or performance vesting conditions.

Vested MLSC Incentive Units were treated as common units for purposes of distributions.

In September 2020, Topco LLC entered into agreements (the “Repurchase Agreements”) to repurchase all remaining and outstanding MLSC Incentive Units, including the 1,500,000 MLSC Incentive Units, accelerated the vesting of all remaining unvested time-based MLSC Incentive Units and also removed the performance condition associated with the performance-based MLSC Incentive Units.

The total compensation cost recognized for these transactions approximated $ 0.8 million.

Topco LLC paid $ 9.1 million to settle the Repurchase Agreements in October 2020.

Unit-based compensation expense related to MLSC Incentive Unit awards was approximately $ 1.5 million for the year ended December 31, 2020.

The total fair value of the MLSC Incentive Units vested was $ 0.9 million for the year ended December 31, 2020.

MLSH 1 Incentive Units

3 unchanged sentences

All vested MLSH 1 Incentive Unit awards are subject to repurchase for fair value at MLSH 1’s option upon a voluntary or involuntary separation event that is not deemed to be for cause.

Upon the IPO, the performance condition was met for certain MLSH 1 Incentive Units and the Company recorded an additional $ 3.5 million of equity-based compensation expense.

The MLSH 1 Incentive Unit awards that include market and service conditions provide for cliff-vesting generally over four or five years .

1 unchanged sentence

The fair value of MLSH 1 Incentive Unit awards was measured at the grant date and recognized as expense over the requisite service period for the awards.

In November 2020, and before the IPO, MLSH 1 Incentive Unit awards were modified to allow for vesting subsequent to the termination of the employment for two employees (i.e.

improbable-probable modification).

The calculation of the incremental equity-based compensation expense was based on the new fair value of the award measured as of the date of modification.

As a result of the modification and based on the performance condition being satisfied, the Company recognized an incremental equity-based compensation expense of $ 16.7 million for the year ended December 31, 2020.

In connection with the divestiture of its Protein Detection business, the Company recognized incremental unit-based compensation expense of $ 2.4 million related to an amended agreement with an executive of Vector (see Note 2).

This unit-based compensation expense was recorded within selling, general and administrative expenses in the consolidated statements of income for the year ended December 31, 2021.

This unit-based compensation expense was recorded within selling, general and administrative expenses in the consolidated statements of operations for the year ended December 31, 2021.

Unit-based compensation expense related to MLSH 1 Incentive Unit awards was approximately $ 0.2 million, $ 0.7 million and $ 3.9 million for the years ended December 31, 2023, 2022 and 2021, respectively.

6 unchanged sentences

Balance as of December 31, 2023 32 $ 28.15

As of December 31, 2022, total unrecognized compensation cost related to unvested MLSH 1 Incentive Units subject to service condition is $ 0.5 million which is expected to be recognized over a weighted average period of 1.6 years.

As of December 31, 2023, total unrecognized compensation cost related to unvested MLSH 1 Incentive Units subject to service condition is $ 0.1 million which is expected to be recognized over a weighted average period of 1.0 year.

Equity-Based Compensation

The following table summarizes the total equity-based compensation expense included in the Company’s consolidated statements of income for the periods presented (in thousands):

The following table summarizes the total equity-based compensation expense included in the Company’s consolidated statements of operations for the periods presented (in thousands):

Year Ended December 31,

3 unchanged sentences

Research and development 2,715 1,129 280

Restructuring

Total equity-based compensation $ 34,588 $ 18,670 $ 10,458

Repurchase of Non-Controlling Interests

In September 2020, Topco LLC and MLSH 1 entered into a Sale and Rollover Agreement with the President of Cygnus Technologies and his affiliated entity (collectively, the “Investors”) to purchase 43,264 MLSC Class B preferred units and 18,387,206 MLSC common units held by the Investors for approximately $ 120.0 million.

In October 2020, Topco LLC repurchased $ 120.0 million of the MLSC Class B preferred and common units for cash.

In addition, the Sale and Rollover Agreement provided that the remaining 16,736 MLSC Class B preferred units and 7,112,794 MLSC common units held by the Investors were exchanged upon the IPO into MLSH 1 common units for $ 46.6 million (the “Exchange”).

In November 2020, and before the IPO, MLSH 1 exchanged its MLSH 1 common units for the remaining MLSC Class B preferred and common units and contributed the MLSC Class B preferred and common units to Topco LLC in a common control transaction.

The difference between the consideration to be paid to the Investors associated with the non-controlling interests of $ 166.4 million and the carrying amount of the non-controlling interests in MLSC of $ 4.8 million was recorded, in the activity prior to the IPO and related Organizational Transactions, as a $ 161.6 million reduction in member’s equity in the consolidated statements of stockholders’/member’s equity.

In November 2020, the MLSC LLC Agreement was amended and restated to recapitalize the outstanding equity into 1,000 common units.

As of December 31, 2023 and 2022, we are subject to U.S.

8 unchanged sentences

Total income from continuing operations $ 617,736 $ 551,472 $ 530,765

Income tax expense (benefit) consisted of the following for the periods presented (in thousands):

Income tax expense consisted of the following for the periods presented (in thousands):

Year Ended December 31,

5 unchanged sentences

Total current tax expense

Deferred tax expense (benefit)

1,169 18,491 14,611

Deferred tax expense

Federal $ 663,968 $ 39,924 $ 36,564

State and local 90,974 2,394 10,340

Total deferred tax expense (benefit) 42,318 46,904 ( 5,464 )

Total deferred tax expense

754,942 42,318 46,904

Total provision for income taxes $ 756,111 $ 60,809 $ 61,515

10 unchanged sentences

Valuation allowance 87.6 0.1 0.1

Nondeductible TRA movement

Other — ( 0.6 ) 0.7

5 unchanged sentences

Investment in Topco LLC $ 595,796 $ 636,498

Net operating loss

Deductions to be received for the Tax Receivable Agreement payments 1,408 148,681

4 unchanged sentences

Total deferred tax assets, net of valuation allowance $ — $ 765,799

As a result of the Organizational Transactions, IPO, and subsequent exchanges and financing, we acquired LLC Units and recognized a deferred tax asset for the difference between the financial reporting and tax basis of our investment in Topco LLC which included net deferred tax assets of $ 765.8 million primarily associated with:

(i) $ 636.5 million related to temporary differences in the book basis as compared to the tax basis of our Company’s investment in Topco LLC and (ii) $ 148.7 million

related to tax benefits from future deductions attributable to payments under the TRA, (iii) $ 3.3 million related to capital loss carryforwards generated during the sale of Vector, and (iv) $ 23.8 million valuation allowance on these items.

which included net deferred tax assets of $ 0.0 million primarily associated with:

(i) $ 595.8 million related to temporary differences in the book basis as compared to the tax basis of our Company’s investment in Topco LLC, (ii) $ 1.4 million related to tax benefits from future deductions attributable to payments under the TRA, (iii) $ 3.3 million related to the capital loss carryforwards generated during the sale of Vector, (iv) $ 41.0 million related to net operating loss carryforwards, and (v) $ 642.2 million valuation allowance on these and other items.

The valuation allowance increased by $ 618.4 million and $ 0.7 million during the years ended December 31, 2023 and 2022, respectively.

The realizability of the Company’s deferred tax asset related to its investment in Topco LLC depends on the Company receiving allocations of tax deductions for its tax basis in the investment and on the Company generating sufficient taxable income to fully offset such deductions.

We believe it is more likely than not that the Company will generate sufficient taxable income in the future to fully realize any deductions allocated to it from Topco LLC associated with the reversal of its tax basis as of December 31, 2022.

However, a portion of the deferred tax asset may only be realizable through the sale or liquidation of the investment and our ability to generate sufficient capital gains.

Therefore, the change in the valuation allowance during December 31, 2022 is primarily due to an increase to reflect the deferred tax asset that is more likely than not to not be realized.

Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of existing deferred tax assets.

A significant piece of objective evidence evaluated during the year ended December 31, 2023 was our current year and projected future pre-tax losses.

Due to our recent history of current year and projected near-term pre-tax losses, we determined that the negative evidence outweighs the positive evidence and so it is more likely than not that our deferred tax assets will not be utilized, and therefore the Company recorded a full valuation allowance on its U.S.

federal and state deferred tax assets.

The objective negative evidence is difficult to overcome and limits the ability to consider other subjective evidence, such as projections of future growth.

It is possible in the foreseeable future that there may be sufficient positive evidence, and that the objective negative evidence related to pre-tax losses will no longer be present, in which event the Company could release a portion or all of the valuation allowance.

Release of any amount of valuation allowance would result in a benefit to income tax expense for the period the release is recorded, which could have a material impact on net earnings.

Alphazyme was treated as a regarded corporation for U.S.

federal and state income tax purposes at the time of acquisition.

The Company recorded the initial contribution of Alphazyme to Topco LLC through its deferred tax asset related to the investment in Topco LLC, which was offset by a valuation allowance against the deferred tax asset.

The Company also recorded a deferred tax liability for the difference between book basis and tax basis in the net assets of Alphazyme through purchase accounting.

However, for the year ended December 31, 2023, Alphazyme became a disregarded entity for U.S.

federal and state income tax purposes, which became effective immediately following the acquisition and prior to the contribution to Topco LLC.

The change in Alphazyme’s tax status resulted in an income tax benefit of $ 8.8 million from the reversal of the Company’s deferred tax liability related to its ownership of Alphazyme, as well as an income tax expense of $ 17.1 million from the impact of the reversal to the Company’s deferred tax asset for its investment in Topco LLC.

Net operating loss (“NOL”) and tax credit carryforwards as of December 31, 2023 were as follows (in millions):

Amount Expiration Years

Net operating losses, federal

$ 36.3 Does not expire

Net operating losses, state

4.7 Varies by state

Capital loss carryforward 3.3 2026

Tax credits, federal 0.3 2043

Tax credits, state 0.3 CA - Do not expire

11 unchanged sentences

The Company files income tax returns in the U.S.

federal jurisdiction and various states.

The Company received a notification on November 2, 2022 from the Internal Revenue Service (“IRS”) informing us of initiated administrative proceedings (audit) of Maravai Life Sciences Holdings, LLC’s 2020 tax year.

We do not have any further information or communication from the taxing authorities with regards to their requests at this time.

The Company is no longer subject to U.S.

federal jurisdiction and various states and is not under audit by taxing authorities in any of these jurisdictions.

With exceptions for certain states, the Company is no longer subject to U.S.

federal, state, and local, or non-U.S.

3 unchanged sentences

The TRA provides for the payment by us to MLSH 1 and MLSH 2, collectively, of 85 % of the amount of certain tax benefits, if any, that we actually realize, or in some circumstances are deemed to realize, as a result of the Organizational Transactions, IPO and any subsequent purchases or exchanges of LLC Units of Topco LLC.

Based on our current projections of taxable income, and before deduction of any specially allocated depreciation and amortization, we anticipate having enough taxable income to utilize most of these tax benefits.

As of December 31, 2022, our liability under the TRA is $ 718.2 million, payable to MLSH 1 and MLSH 2, representing approximately 85 % of the calculated tax savings we anticipate being able to utilize in future years.

During the year ended December 31, 2022, the Company recognized a loss of $ 4.1 million on TRA liability adjustment primarily due to changes in our estimated state apportionment and the corresponding change of our estimated state tax rate.

The Company expects to benefit from the remaining 15 % of any cash tax savings that it realizes.

We recognize the amount of TRA payments expected to be paid within the next 12 months and classify this amount as current.

This determination is based on our estimate of taxable income for the year ended December 31, 2023.

As of December 31, 2023, the current liability under the TRA was $ 7.1 million.

As of December 31, 2023, the Company has derecognized the remaining $ 665.3 million non-current liability under the TRA after concluding it was not probable that the Company will be able to realize the remaining tax benefits based on estimates of future taxable income.

The estimation of liability under the TRA is by its nature imprecise and subject to significant assumptions regarding the amount, character, and timing of the taxable income in the future.

If the Company concludes in a future period that the tax benefits are more likely than not to be realized and releases its valuation allowance, the corresponding TRA liability amounts may be considered probable at that time and recorded on the consolidated balance sheet and within earnings.

We made payments of $ 42.6 million to MLSH 1 and MLSH 2 pursuant to the TRA during the year ended December 31, 2023, of which $ 0.4 million is related to interest.

We made payments of $ 1.3 million to MLSH 1 and MLSH 2 pursuant to the TRA during the year ended December 31, 2021.

No payments were made during the year ended December 31, 2020.

We made payments of $ 35.3 million to MLSH 1 and MLSH 2 pursuant to the TRA during the year ended December 31, 2022, of which $ 1.1 million was related to interest.

As of December 31, 2023 and 2022, our liabilities under the TRA were $ 7.1 million and $ 718.2 million, respectively.

9 unchanged sentences

and foreign income taxes.

As a result, the accompanying consolidated statements of income include income tax expense related to those states and to U.S.

As a result, the accompanying consolidated statements of operations include income tax expense related to those states and to U.S.

and foreign jurisdictions where Topco LLC or any of our subsidiaries are subject to income tax.

10 unchanged sentences

The Company’s Executive Chairman of the Board, Chief Financial Officer (“CFO”) and General Counsel are executives of MLSH 1 and MLSH 2.

Advisory and Services Agreement with GTCR

Prior to the IPO, GTCR provided subsidiaries of the Company with financial and management consulting services through an advisory services agreement.

This advisory services agreement also provided that the Company pay placement fees to GTCR of 1.0 % of the gross amount of any debt or equity financings as well as quarterly management fees.

The advisory services agreement was terminated in connection with the IPO.

The Company also reimburses GTCR for out-of-pocket expenses incurred while providing the above professional services.

During the year ended December 31, 2020, the Company entered into the Credit Agreement (see Note 9) and paid GTCR a $ 3.7 million placement fee.

For the year ended December 31, 2020, the Company incurred approximately $ 4.2 million in management fees to GTCR.

All other amounts paid or payable under these agreements to GTCR were insignificant for all periods presented.

Director Nomination Agreement with GTCR

In connection with the IPO, the Company entered into a Director Nomination Agreement with GTCR.

The Director Nomination Agreement provides GTCR the right to nominate to the Board a number of designees equal to at least:

(i) 100 % of the total number of directors comprising the Board, so long as GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 40 % of the total amount of shares of Class A common stock and Class B common stock it owns, (ii) 40 % of the total number of directors, in the event that GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 30 % but less than 40 % of the total amount of shares of Class A common stock and Class B common stock it owns, (iii) 30 % of the total number of directors, in the event that GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 20 % but less than 30 % of the total amount of shares of Class A common stock and Class B common stock it owns, (iv) 20 % of the total number of directors, in the event that GTCR

beneficially owns shares of Class A common stock and Class B common stock representing at least 10 % but less than 20 % of the total amount of shares of Class A common stock and Class B common stock it owns and (v) one director, in the event that GTCR beneficially owns shares of Class A common stock and Class B common stock representing at least 5 % of the total amount of shares of Class A common stock and Class B common stock it owns.

In addition, GTCR is entitled to designate the replacement for any of its Board designees whose Board service terminates prior to the end of the director’s term, regardless of GTCR’s beneficial ownership at that time.

GTCR also has the right to have its designees participate on committees of the Company’s Board proportionate to its voting power, subject to compliance with applicable law and stock exchange rules.

The Director Nomination Agreement also prohibits the Company from increasing or decreasing the size of our Board without the prior written consent of GTCR.

This agreement will terminate at such time as GTCR beneficially owns less than 5 % of the shares of Class A and Class B common stock it beneficially owned at the date of the IPO.

Registration Rights Agreement with MLSH 1 and MLSH 2

15 unchanged sentences

During the years ended December 31, 2023, 2022 and 2021, the Company made distributions of $ 9.6 million, $ 150.2 million and $ 153.5 million for tax liabilities to MLSH 1 under this agreement, respectively.

Other Distributions

In October 2020, the Company made an $ 88.6 million distribution to MLSH 1.

Contract Development and Manufacturing Agreement with Curia Global

GTCR has significant influence over Curia Global (“Curia”).

During the year-ended December 31, 2022, the Company paid insignificant amounts to Curia for contract manufacturing and development services.

During the years ended December 31, 2023 and 2022, the Company paid insignificant amounts to Curia for contract manufacturing and development services.

During the year ended December 31, 2021, the Company paid $ 7.4 million to Curia.

Such amounts were included in research and development expenses on the consolidated statements of income.

Such amounts were included in research and development expenses on the consolidated statements of operations.

Maravai LifeSciences Foundation

5 unchanged sentences

Segment results are presented in the same manner as we present our operations internally to make operating decisions and assess performance.

The accounting policies for the segments are the same as those described in Significant Accounting Policies (see Note 1).

The accounting policies for the segments are the

same as those described in Significant Accounting Policies (see Note 1).

The Company’s financial performance is reported in three segments.

4 unchanged sentences

• Biologics Safety Testing :

focuses on manufacturing and selling biologics safety and impurity tests and assay development services that are utilized by our customers in their biologic drug manufacturing spectrum.

focuses on the manufacturing and sale of host cell protein, bioprocess impurity detection, viral clearance prediction kits and associated products.

This segment also provides services for custom antibody development, assay development, antibody affinity extraction and mass spectrometry that are utilized by our customers in their biologic drug manufacturing spectrum.

• Protein Detection :

3 unchanged sentences

Adjusted EBITDA assists management in comparing the segment performance on a consistent basis for purposes of business decision-making by removing the impact of certain items that management believes do not directly reflect the core operations and, therefore, are not included in measuring segment performance.

The Company defines Adjusted EBITDA as net income before interest, taxes, depreciation and amortization, certain non-cash items and other adjustments that we do not consider in our evaluation of ongoing operating performance from period to period.

The Company defines Adjusted EBITDA as net (loss) income before interest, taxes, depreciation and amortization, certain non-cash items and other adjustments that we do not consider in our evaluation of ongoing operating performance from period to period.

Corporate costs, net of eliminations, are managed on a standalone basis and not allocated to segments.

The following schedule includes revenue and adjusted EBITDA for each of the Company’s reportable operating segments (in thousands):

We have revised our presentation for the prior periods below to remove the presentation of Total Adjusted EBITDA and reconcile the total of our reportable segments’ measure of profit or loss to income before income taxes in addition to net income, and removed corporate costs, net of eliminations from total reportable segments’ adjusted EBITDA and included such amounts in the reconciliation to income before income taxes.

Additionally, we have revised our prior years’ presentation of our

total reportable segments’ revenue, in which we removed intersegment eliminations from our total reportable segment’s revenue.

Year Ended December 31,

20 unchanged sentences

Acquisition integration costs ( 12,695 ) ( 13,362 ) ( 44 )

Acquired in-process research and development costs — — ( 2,881 )

Equity-based compensation ( 34,588 ) ( 18,670 ) ( 10,458 )

GTCR management fees — — ( 680 )

Gain on sale of business — — 11,249

Gain on sale and leaseback transaction — — 19,002

Merger and acquisition related expenses ( 4,392 ) ( 2,416 ) ( 1,508 )

3 unchanged sentences

Chief Executive Officer transition costs ( 28 ) ( 2,426 ) —

Restructuring costs (1)

( 6,567 ) — —

Other ( 1,763 ) ( 1,814 ) —

1 unchanged sentence

Income tax expense ( 756,111 ) ( 60,809 ) ( 61,515 )

Net income $ 490,663 $ 469,250 $ 78,816

During the year ended December 31, 2022, intersegment revenue was immaterial between the Nucleic Acid Production and Biologics Safety Testing segments.

During the years ended December 31, 2021 and 2020, intersegment revenue was $ 0.7 million and $ 1.3 million, respectively, between the Nucleic Acid Production and Protein Detection segments.

Net (loss) income

$ ( 138,375 ) $ 490,663 $ 469,250

___________________

(1) Equity-based compensation benefit of $ 0.1 million related to forfeited equity awards in connection with the restructuring is included on the equity-based compensation line item.

During the years ended December 31, 2023 and 2022, intersegment revenue was immaterial between the Nucleic Acid Production and Biologics Safety Testing segments.

During the year ended December 31, 2021, intersegment revenue was $ 0.7 million between the Nucleic Acid Production and Protein Detection segments.

The intersegment sales and the related gross margin on inventory recorded at the end of the period are eliminated for consolidation purposes.

2 unchanged sentences

The Company does not allocate assets to its reportable segments as they are not included in the review performed by the CODM for purposes of assessing segment performance and allocating resources.

Subsequent Event

In January 2023, we completed the acquisition of Alphazyme, LLC (“Alphazyme”), a privately-held original equipment manufacturer (“OEM”) provider of custom, scalable, molecular biology enzymes to customers in the genetic analysis and nucleic acid synthesis markets.

The total consideration to acquire Alphazyme consisted of a base cash purchase price of $ 70.0 million, subject to customary post-closing adjustments, and potential performance payments payable in cash of up to $ 75.0 million.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data