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Item 9A. Controls and Procedures

2024-02-22 compared with 2023-02-22 · 668 added, 536 removed, 1004 unchanged (55% of the section changed)

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(a) Disclosure Controls and Procedures.

The Company’s management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act and as required by paragraph (b) of Rules 13a-15 or 15d-15 under the Exchange Act) as of the end of the period covered by this report.

Based on such evaluation, our principal executive officer and principal financial officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective at the reasonable assurance level.

The Company’s management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”) and as required by paragraph (b) of Rules 13a-15 or 15d-15 under the Exchange Act) as of the end of the period covered by this report.

Based on such evaluation, our principal executive officer and principal financial officer have concluded that, as of December 31, 2023, the Company’s disclosure controls and procedures were not effective as of such date due to a material weakness in our internal control over financial reporting, as described below.

(b) Report of Management on Internal Control Over Financial Reporting.

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting.

Internal control over financial reporting is defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers and effected by the Company’s Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S.

Internal control over financial reporting is defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers and effected by the Company’s Board of Directors (“Board”), management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S.

generally accepted accounting principles and includes those policies and procedures that:

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

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

Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2022.

In making this assessment, management used the criteria established in Internal Control –

Integrated Framework , issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (COSO).

In connection with our initiative to integrate and enhance our global information technology systems and business processes, we continued the phased implementation of a new enterprise resource planning (“ERP”) system.

The Company is implementing the ERP system in phases and will continue until all current and future subsidiaries are using it.

The fourth phase of implementation was completed during the first quarter of 2022.

In addition, we completed the implementation of a lease accounting system, LeaseQuery, during the first quarter of 2022.

As a result of these implementations, we modified certain existing internal controls over financial reporting as well as implemented new controls and procedures related to the new ERP system and LeaseQuery system as of December 31, 2022.

Other than the foregoing, there have been no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Securities Exchange Act Rule 13a-15 or Rule 15d-15 that occurred in the three months ended December 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Subject to the foregoing, based on this assessment, our management concluded that, as of December 31, 2022, our internal control over financial reporting is effective based on those criteria.

Ernst & Young LLP, the independent registered public accounting firm that audited our financial statements included in this Form 10-K, has issued an attestation report on our internal control over financial reporting as of December 31, 2022.

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

Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2023.

In making this assessment, management used the criteria established in Internal Control – Integrated Framework , issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (COSO).

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

We acquired FlexBiosys Inc.

(“FlexBiosys”) on April 17, 2023 and Metenova Holding AB ("Metenova") on October 2, 2023.

The financial results of each of these acquisitions are included in our audited consolidated financial statements as of December 31, 2023.

The Company's consolidated total assets as of December 31, 2023 includes $43.7 million and $197.2 million from the FlexBiosys and Metenova businesses, respectively.

The Company's consolidated revenue for the year ended December 31, 2023 includes $2.5 million and $5.0 million from the FlexBiosys and Metenova businesses, respectively.

As these acquisitions occurred during 2023, the scope of our assessment of our internal control over financial reporting does not include these acquisitions.

These exclusions are in accordance with the Security and Exchange Commission's general guidance that an assessment of a recently acquired business may be omitted from our scope in the year of such acquisition.

The Company is implementing the ERP system in phases and will continue until all current and future subsidiaries are using it.

The fifth phase of implementation was

completed during the second quarter of 2023.

As a result of this implementation, we modified certain existing internal control over financial reporting as well as implemented new controls and procedures related to the new ERP system as of December 31, 2023.

In conjunction with management’s assessment of internal control over financial reporting in the fourth quarter of 2023, management identified a material weakness in the operation of our controls over the deferred income tax accounting for complex and non-routine transactions.

Specifically, management did not have adequate supervision and review controls over the complex accounting for deferred income tax on the exchange of our outstanding 0.375% Convertible Senior Notes due 2024 and the issuance of 1.00% Convertible Senior Notes due 2028, including work performed by external advisors and the internal review of such transaction and related analyses.

This material weakness did not result in an error in any of our previously issued consolidated financial statements including the consolidated financial statements as of and for the year ended December 31, 2023.

Based on this material weakness, the Company’s management concluded that at December 31, 2023, the Company’s internal control over financial reporting was not effective.

Income tax accounting related to non-routine transactions

Following identification of the material weakness, and as part of our commitment to strengthen our internal control over financial reporting, we are implementing remedial actions under the oversight of the Audit Committee of our Board to address these deficiencies.

On highly-technical, non-routine and complex accounting transactions, we will continue to engage nationally recognized third-party advisors with the requisite skills and technical expertise to assist us in assessing, performing and reviewing such transactions;

however we will:

• Improve our process to identify and select qualified third-party advisors, including enhanced review of capabilities and work performed, specifically related to the review of tax advice and related accounting guidance.

• Implement a process to verify the controls, processes and internal reviews performed by third-party advisors.

• Consider whether the non-routine transaction warrants additional advisor oversight or validation of analyses based on complexity or changes in applicable regulations.

• Increase education for internal resources on complex transactions to enhance diligence capabilities with third-party advisors.

We will continue to monitor the design and operating effectiveness of these and other processes, procedures and controls and make any further changes management determines appropriate.

Our CEO and CFO have certified that, based on their knowledge, our consolidated financial statements and other financial information included in this Annual Report on Form 10-K (“Form 10-K”), fairly present, in all material respects, our financial condition, results of operations and cash flows as of, and for, the periods presented in this Form 10-K.

Ernst & Young LLP, the independent registered public accounting firm that audited our consolidated financial statements included in this Form 10-K, has issued an unqualified opinion on our consolidated financial statements and has issued an attestation report on our internal control over financial reporting as of December 31, 2023.

Changes in Internal Control Over Financial Reporting

Except for the material weakness described above, there has been no change in our internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) that occurred during the quarter ended December 31, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Consolidated financial statements reflected in our current Form 10-K are accurately stated.

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Opinion on Internal Control Over Financial Reporting

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

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

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2022 and 2021, the related consolidated statements of comprehensive income, stockholders' equity and cash flows for each of the three years in the period ended December 31, 2022, and the related notes and our report dated February 22, 2023 expressed an unqualified opinion thereon.

We have audited Repligen Corporation’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, because of the effect of the material weakness described below on the achievement of the objectives of the control criteria, Repligen Corporation (the Company) has not maintained effective internal control over financial reporting as of December 31, 2023, based on the COSO criteria.

As indicated in the accompanying Report of Management on Internal Control Over Financial Reporting, management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of Metenova Holding AB ("Metenova") and FlexBiosys Inc.

("FlexBiosys"), which is included in the 2023 consolidated financial statements of the Company and constituted $197.2 million and $43.7 million of total assets, respectively, as of December 31, 2023 and $5.0 million and $2.5 million of revenues, respectively, for the year then ended.

Our audit of internal control over financial reporting of the Company also did not include an evaluation of the internal control over financial reporting of Metenova and FlexBiosys.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

The following material weakness has been identified and included in management’s assessment.

Management has identified a material weakness in controls related to income tax accounting related to non-routine transactions.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2023 and 2022, the related consolidated statements of comprehensive income, stockholders' equity and cash flows for each of the three years in the period ended December 31, 2023, and the related notes.

This material weakness was considered in determining the nature, timing and extent of audit tests applied in our audit of the 2023 consolidated financial statements, and this report does not affect our report dated February 22, 2024, which expressed an unqualified opinion thereon.

Basis for Opinion

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

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

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

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Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

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

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in

accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

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(d) Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Securities Exchange Act Rule 13a-15 or Rule 15d-15 that occurred in the three months ended December 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

There have been no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rule 13a-15 or Rule 15d-15 that occurred in the three months ended December 31, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

OTHER INFORMATION

Rule 10b5-1 Trading Plans

During the fourth quarter of 2023, Tony J.

Hunt , Chief Executive Officer , adopted a trading plan intended to satisfy Rule 10b5-1(c) under the Securities Exchange Act of 1934 ("Exchange Act") on November 9, 2023 to sell up to 78,216 shares of our common stock between March 8, 2024 and November 15, 2024 , the date this plan expires.

The trading plan will cease upon the earlier of November 15, 2024 or the sale of all shares subject to the trading plan.

During the fourth quarter of 2023, none of our other directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted , modified , or terminated a Rule 10b5-1 trading arrangement.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

Pursuant to General Instructions G to Form 10-K, the information required for Part III, Items 10, 11, 12, 13 and 14, is incorporated herein by reference from the Company’s proxy statement for the 2023 Annual Meeting of Stockholders.

EXHIBITS AND FINAN CIAL STATEMENT SCHEDULES

The following documents are filed as part of this Form 10-K:

The following documents are filed as part of this Annual Report on Form 10-K ("Form 10-K"):

(a) (1) Financial Statements :

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Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2023, 2022 and 2021

Consolidated Statements of Stockholders’

Equity for the Years Ended December 31, 2022, 2021 and 2020

Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2023, 2022 and 2021

Consolidated Statements of Cash Flows for the Years Ended December 31, 2023, 2022 and 2021

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Document Description

Stock Purchase Agreement, dated April 25, 2019, by and among Repligen Corporation, C Technologies and Craig Harrison (filed as Exhibit 2.1 to Repligen Corporation’s Current Report on Form 8-K filed on April 26, 2019 and incorporated herein by reference).

Restated Certificate of Incorporation dated June 30, 1992, as amended September 17, 1999 (filed as Exhibit 3.1 to Repligen Corporation’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1999 and incorporated herein by reference).

Certificate of Amendment to the Certificate of Incorporation of Repligen Corporation, effective as of May 16, 2014 (filed as Exhibit 3.1 to Repligen Corporation’s Current Report on Form 8-K filed on May 19, 2014 and incorporated herein by reference).

Third Amended and Restated Bylaws (filed as Exhibit 3.1 to Repligen Corporation’s Current Report on Form 8-K filed on January 28, 2021 and incorporated herein by reference).

Specimen Stock Certificate (filed as Exhibit 4.1 to Repligen Corporation’s Annual Report on Form 10-K for the year ended March 31, 2002 and incorporated herein by reference).

Base Indenture, dated as of July 19, 2019, by and between Repligen Corporation and Wilmington Trust, National Association (filed as Exhibit 4.1 to Repligen Corporation’s Current Report on Form 8-K filed on July 22, 2019 and incorporated herein by reference).

First Supplemental Indenture, dated as of July 19, 2019, by and between Repligen Corporation and Wilmington Trust, National Association (filed as Exhibit 4.2 to Repligen Corporation’s Current Report on Form 8-K filed on July 22, 2019 and incorporated herein by reference).

Certificate of Amendment to the Certificate of Incorporation of Repligen Corporation, effective as of May 19, 2023 (filed as Exhibit 3.1 to Repligen Corporation's Current Report on Form 8-K filed on May 22, 2023 and incorporated herein by reference).

Third Amended and Restated Bylaws (filed as Exhibit 3.1 to Repligen Corporation’s Current Report on Form 8-K filed on January 28, 2021 and incorporated herein by reference).

Specimen Stock Certificate (filed as Exhibit 4.1 to Repligen Corporation’s Annual Report on Form 10-K for the year ended March 31, 2002 and incorporated herein by reference).

Second Supplemental Indenture, dated as of March 4, 2022, by and between Repligen Corporation and Wilmington Trust, National Association, as trustee (filed as Exhibit 4.1 to Repligen Corporation's Form 8-K filed on March 8, 2022).

Form of 0.375% Convertible Senior Note due 2024 (included in Exhibit 4.3).

Description of Certain Registrant’s Securities (filed as Exhibit 4.5 to Repligen Corporation’s Annual Report on Form 10-K for the year ended December 31, 2019 and incorporated by reference).

Repligen Executive Incentive Compensation Plan (filed as Exhibit 10.1 to Repligen Corporation’s Current Report on Form 8-K filed on December 14, 2005 and incorporated herein by reference).

Second Amended and Restated 2001 Repligen Corporation Stock Plan (filed as Exhibit 10.1 to Repligen Corporation’s Current Report on Form 8-K filed on September 18, 2008 and incorporated herein by reference).

Amended and Restated 2001 Repligen Corporation Stock Option Plan, Form of Incentive Stock Option Agreement (filed as Exhibit 10.14 to Repligen Corporation’s Annual Report on Form 10-K for the year ended March 31, 2005 and incorporated herein by reference).

Amended and Restated 2001 Repligen Corporation Stock Plan, Form of Restricted Stock Agreement (filed as Exhibit 10.1 to Repligen Corporation’s Current Report on Form 8-K filed on January 9, 2006 and incorporated herein by reference).

Lease Between Repligen Corporation as Tenant and West Seyon LLC as Landlord, 35 Seyon Street, Waltham, MA (as amended to date) (filed as Exhibit 10.4 to Repligen Corporation’s Annual Report on Form 10-K for the year ended December 31, 2019 and incorporated herein by reference).

Strategic Supplier Alliance Agreement dated January 28, 2010 by and between Repligen Corporation and GE Healthcare Bio-Sciences AB (as amended to date) (filed as Exhibit 10.1 to Repligen Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 and incorporated herein by reference).

Repligen Corporation Amended and Restated 2012 Stock Option and Incentive Plan (filed as Exhibit 99.1 to Repligen Corporation’s Form S-8 filed on June 2, 2014 and incorporated herein by reference).

Letter Agreement, dated as of June 10, 2014, by and between Repligen Corporation and Jon K.

Snodgres (filed as Exhibit 10.1 to Repligen Corporation’s Current Report on Form 8-K filed on July 15, 2014 and incorporated herein by reference).

Form of 0.375% Convertible Senior Notes due 2024 (included in Exhibit 4.3).

Base Indenture, dated as of December 14, 2023, by and between Repligen Corporation and Wilmington Trust, National Association (filed as Exhibit 4.1 to Repligen Corporation's Current Report on Form 8-K filed on December 15, 2023 and incorporated herein by reference).

Form of 1.00% Convertible Senior Notes due 2028 (included in Exhibit 4.6).

Description of Certain Registrant’s Securities (filed as Exhibit 4.5 to Repligen Corporation’s Annual Report on Form 10-K for the year ended December 31, 2019 and incorporated by reference).

Repligen Executive Incentive Compensation Plan (filed as Exhibit 10.1 to Repligen Corporation’s Current Report on Form 8-K filed on December 14, 2005 and incorporated herein by reference).

Repligen Corporation Amended and Restated 2012 Stock Option and Incentive Plan (filed as Exhibit 99.1 to Repligen Corporation’s Form S-8 filed on June 2, 2014 and incorporated herein by reference).

Repligen Corporation Amended and Restated Non-Employee Directors' Compensation Policy.

Form of Indemnification Agreement (filed as Exhibit 10.1 to Repligen Corporation’s Current Report on Form 8-K filed on May 12, 2016 and incorporated herein by reference).

Lease Agreement, dated February 6, 2018, by and between Repligen Corporation and U.S.

REIF 111 Locke Drive Massachusetts, LLC (filed as Exhibit 10.1 to Repligen Corporation’s Current Report on Form 8-K filed on February 8, 2018 and incorporated herein by reference).

2018 Repligen Corporation Stock Option and Incentive Plan (filed as Exhibit 10.1 to Repligen Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 and incorporated herein by reference).

Letter Agreement, dated as of September 3, 2016 by and between Repligen Corporation and Ralf Kuriyel (filed as Exhibit 10.17 to Repligen Corporation’s Annual Report on Form 10-K for the year ended December 31, 2018 and incorporated herein by reference).

REIF 111 Locke Drive Massachusetts, LLC (filed as Exhibit 10.1 to Repligen Corporation’s Current Report on Form 8-K filed on February 8, 2018 and incorporated herein by reference).

Repligen Corporation Amended and Restated Severance and Change in Control Plan, effective as of May 26, 2022 (filed as Exhibit 10.1 to Repligen Corporation's Form 8-K filed June 1, 2022).

Third Amendment and Restated Employment Agreement, dated as of May 26, 2022, by and between Repligen Corporation and Tony J.

Hunt (filed as Exhibit 10.2 to Repligen Corporation's Form 8-K filed June 1, 2022).

Employment Agreement, dated as of September 8, 2023, by and between Repligen Corporation and Olivier Loeillot (filed as Exhibit 10.1 to Repligen Corporation's Form 10-Q for the quarter ended September 30, 2023).

Employment Agreement, dated as of September 8, 2023, by and between Repligen Corporation and Jason Garland (filed as Exhibit 10.1 to Repligen Corporation's Current Report on Form 8-K filed on September 12, 2023).

First Amendment to Lease Agreement, dated as of July 7, 2020 by and between Repligen Corporation and U.S.

REIF 111 Locke Drive Massachusetts, LLC (filed as Exhibit 10.1 to Repligen Corporation’s Current Report on Form 8-K filed on July 10, 2020 and incorporated herein by reference).

Repligen Corporation 2018 Stock Option and Incentive Plan, Sub-Plan for French-Qualified Restricted Stock Units (filed as Exhibit 10.1 to Repligen Corporation’s Form 10-Q for the quarter ended June 30, 2021 and incorporated herein by reference).

REIF 111 Locke Drive Massachusetts, LLC (filed as Exhibit 10.1 to Repligen Corporation’s Current Report on Form 8-K filed on July 10, 2020 and incorporated herein by reference).

Repligen Corporation Amended and Restated Statement of Company Policy on Insider Trading and Disclosure & Trading Procedures for Insiders.

Subsidiaries of the Registrant.

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Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Repligen Corporation Compensation Recovery Policy.

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Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101.*).

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Cover page formatted as Inline XBRL and contained in Exhibits 101.*).

# Confidential treatment obtained as to certain portions.

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10 -K SUMMARY

We may voluntarily include a summary of information required by Form 10-K under Item 16.

We may voluntarily include a summary of information required by Annual Report on Form 10-K under Item 16.

We have elected not to include such summary information.

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/ S / T ONY J.

President and Chief Executive Officer

Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby makes, constitutes and appoints Tony J.

Hunt and Jon K.

Snodgres with full power to act without the other, his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities to sign any or all amendments to this Form 10-K, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agents of any of them, or any substitute or substitutes, lawfully do or cause to be done by virtue hereof.

Hunt and Jason K.

Garland with full power to act without the other, his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities to sign any or all amendments to this Annual Report on Form 10-K, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agents of any of them, or any substitute or substitutes, lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/ S / T ONY J.

President, Chief Executive Officer and Director

Chief Executive Officer and Director

(Principal executive officer)

February 22, 2024

/ S / J ON K.

/ S / J ASON K.

Chief Financial Officer

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Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2023, 2022 and 2021

Consolidated Statements of Stockholders’

Equity for the Years Ended December 31, 2022, 2021 and 2020

Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2023, 2022 and 2021

Consolidated Statements of Cash Flows for the Years Ended December 31, 2023, 2022 and 2021

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Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Repligen Corporation (the Company) as of December 31, 2022 and 2021, the related consolidated statements of comprehensive income, stockholders' 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”).

We have audited the accompanying consolidated balance sheets of Repligen Corporation (the Company) as of December 31, 2023 and 2022, the related consolidated statements of comprehensive income, 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.

generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 22, 2023 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 22, 2024 expressed an adverse opinion thereon.

Adoption of ASU No.

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Our responsibility is to express an opinion on the Company's financial statements based on our audits.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the US federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

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

Valuation of contingent consideration

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.

Accounting for acquisitions

Description of

As disclosed in Note 4 to the consolidated financial statements under the caption “Acquisitions”

and Note 3 under the caption “Fair Value Measurements”, during 2021, the Company completed the acquisition of Avitide, Inc.

for consideration of approximately $246.3 million, net of cash acquired.

The Company recognized a contingent consideration liability at the estimated fair value on the acquisition date in

connection with applying the acquisition accounting for business combinations.

Subsequent changes to the fair value of the contingent consideration liability are recorded within the consolidated statement of comprehensive income in the period of change.

At December 31, 2022, the Company had a $65.5 million contingent consideration liability, which represented a ‘Level 3’

fair value measurement in the fair value hierarchy due to the significant unobservable inputs used in determining the fair value and the use of management judgement about the assumptions market participants would use in pricing the liability.

Auditing the Company's accounting for its contingent consideration liability was complex and required significant auditor judgment due to the use of a Monte Carlo simulation model and the high degree of subjectivity in evaluating certain assumptions required to estimate the fair value of contingent payments.

In particular, the fair value measurement was sensitive to the significant assumptions underlying future revenue and production forecasts, as well as, the probability of achieving such forecasts.

As disclosed in Note 4 to the consolidated financial statements, during 2023, the Company completed two acquisitions.

The most significant of the two acquisitions was the acquisition of Metenova Holding AB for total consideration of approximately $172.6 million.

The transactions were accounted for as business combinations.

Auditing the Company's accounting for its acquisition of Metenova Holding AB was complex due to the significant estimation uncertainty in the Company’s determination of the fair value of identified intangible assets of $58.8 million, which principally consisted of customer relationships and developed technology.

The significant estimation uncertainty was primarily due to the sensitivity of the respective customer relationship and developed technology fair values to underlying assumptions about the future performance of the acquired business.

The Company used a discounted cash flow model to measure the customer relationship and developed technology intangible assets.

The significant assumptions used to estimate the value of the intangible assets included discount rates and certain assumptions that form the basis of the forecasted results, including revenue growth, and cost of revenues and operating expenses as a percentage of revenue.

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

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Matter in Our

We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company's contingent consideration liability process including, among others, management's process to establish the significant assumptions and measure the liability.

Our tests included controls over management's review of assumptions used in the valuation model.

To test the estimated fair value of the contingent consideration liability, our audit procedures included, among others, inspecting the terms of the executed purchase agreement, assessing the Monte Carlo simulation model used and testing the key contractual inputs and significant assumptions discussed above.

We performed audit procedures that included, among others, evaluating the Company's selection of the valuation methodology, evaluating the methods and significant assumptions used by the Company, and evaluating the completeness and accuracy of the underlying data supporting the significant assumptions and estimates.

This includes comparing the significant assumptions to current industry, market and economic trends, to the historical results of the acquired business and to other guidelines used by companies within the same industry.

We tested the Company's controls over its accounting for acquisitions.

Our tests included controls over the determination of the fair value of customer relationship and developed technology intangible assets.

We also tested management’s review of assumptions used in the valuation models.

To test the estimated fair value of the customer relationship and developed technology intangible assets, we performed audit procedures that included, among others, evaluating the Company's selection of the valuation methodology, evaluating the methods and significant assumptions used by the Company, and evaluating the completeness and accuracy of the underlying data supporting the significant assumptions and estimates.

This includes comparing the significant assumptions to current industry, market and economic trends, to the assumptions used to value similar assets in other acquisitions, to the historical results of the acquired business and to other guidelines used by companies within the same industry.

We involved our valuation professionals to assist in our evaluation of the methodology used by the Company and significant assumptions included in the fair value estimates.

Accounting for convertible notes

Description of

As disclosed in Note 14 to the consolidated financial statements, during 2023, the Company issued $600.0 million aggregate principal amount of 1.00% Convertible Senior Notes due in 2028 (the “2023 Notes”).

The Company privately negotiated exchange and subscription agreements (the “Exchange and Subscription Agreements”) with a limited number of holders of its outstanding 2019 Notes and certain other qualified institutional buyers.

Pursuant to the Exchange and Subscription Agreements, the Company exchanged $217.7 million of its 2019 Notes for $309.9 million aggregate principal of the 2023 Notes (the “Exchange Transaction”) and issued $290.1 million aggregate principal amount of the 2023 Notes in a private placement to accredited institutional buyers (the “Subscription Transactions”) for $290.1 million in cash.

The Company evaluated the Exchange Transaction for extinguishment or modification accounting and recorded an extinguishment loss of $12.7 million and an aggregate debt discount of $82.1 million related to the settlement of the Exchange Transaction.

Auditing the accounting treatment for the 2023 Notes and the Exchange Transaction involved especially challenging and complex auditor judgment and required team members with specialized knowledge and skills in accounting and valuation in order to evaluate the Company’s accounting assessment, and the determination of the related extinguishment loss upon settlement of the Exchange Transaction.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company’s controls over the issuance of the 2023 Notes and the accounting for the Exchange Transaction, including the valuation of the conversion feature used in the extinguishment test and incorporated into the accounting assessment for the Exchange Transaction to determine the extinguishment loss and debt discount recorded.

Our testing of the Company’s accounting for the issuance of the 2023 Notes and Exchange Transaction included, among other procedures, inspection of the underlying Exchange and Subscription Agreements and testing management’s application of the relevant accounting guidance.

To test the Exchange Transaction, we evaluated the Company’s extinguishment accounting assessment, including the Company’s determination of the change in fair value of the conversion feature associated with the Exchange Transaction, which included testing the

appropriateness of the methodology and underlying assumptions used to determine such fair value.

We involved our valuation professionals to assist in our evaluation of the valuation methodology used by the Company and significant assumptions included in the fair value estimate.

Also, we tested the Company’s key inputs into the calculation of the extinguishment loss and evaluated the appropriateness of the Company’s disclosures.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2002

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

Boston, Massachusetts

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Accrued liabilities

Convertible Senior Notes, net

Convertible Senior Notes due 2024, net

Total current liabilities

Noncurrent liabilities:

Convertible Senior Notes due 2028, net

Deferred tax liabilities

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Accumulated earnings

Total stockholders’

Total liabilities and stockholders’

Total stockholders’ equity

Total liabilities and stockholders’ equity

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

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Income from operations

Other (expenses) income:

Other income (expenses):

Investment income

Interest expense

Loss on extinguishment of debt

Amortization of debt issuance costs

Other expenses

Other expenses, net

Other income (expenses)

Other income (expenses), net

Income before income taxes

Income tax provision (benefit)

Income tax provision

Earnings per share:

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REPLIGEN CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Amounts in thousands, except share data)

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Balance at December 31, 2020

Exercise of stock options and vesting

of stock units

Issuance of common stock pursuant

to the acquisition of ARTeSYN

Proceeds from issuance of common

stock, net of issuance costs

of $ 0.4 million

Stock-based compensation expense

Translation adjustment

Balance at December 31, 2020

Issuance of common stock for debt

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Balance at December 31, 2022

Issuance of common stock for debt

Exercise of stock options and vesting

of stock units

Repurchase of common stock

Tax withholding on vesting of

restricted stock

Issuance of common stock pursuant to the

acquisition of FlexBiosys, Inc.

Issuance of common stock pursuant to the

acquisition of Metenova Holding AB

Issuance of common stock pursuant to the Avitide,

contingent consideration earnout payment

Stock-based compensation expense

Convertible note modification

Deferred tax impact on conversion feature

Translation adjustment

Balance at December 31, 2023

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

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Amortization of debt discount and issuance costs

Stock-based compensation expense

Contingent consideration expense

Stock-based compensation

Deferred income taxes, net

Contingent consideration

Non-cash interest income

Loss on extinguishment of debt

Changes in operating assets and liabilities, excluding impact of acquisitions:

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Purchase of marketable securities held to maturity

Redemption of marketable securities

Additions to capitalized software costs

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Cash flows from financing activities:

Proceeds from issuance of common stock, net of issuance costs

Repurchase of common stock

Proceeds from issuance of 2023 Convertible Senior Notes

Proceeds from exercise of stock options

Repayment of Convertible Senior Notes

Payment of debt issuance costs

Payment of tax withholding obligation on vesting of restricted stock

Total cash (used in) provided by financing activities

Effect of exchange rate changes on cash, cash equivalents and restricted cash

Net (decrease) increase in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash, beginning of period

Payment of earnout consideration

Other financing activities

Total cash provided by (used in) financing activities

Effect of exchange rate changes on cash and cash equivalents

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

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Assets acquired under operating leases

Fair value of 271,096 shares of common stock issued for acquisition

of Avitide, Inc.

Fair value of earnouts related to the acquisition of Avitide, Inc.

Fair value of 372,990 shares of common stock issued for acquisition

of ARTeSYN Biosolutions Holdings Ireland Limited

Fair value of shares of common stock issued for acquisitions

Fair value of shares of common stock issued for contingent consideration earnouts

Acquisition date fair value of contingent consideration earnouts

Issuance of 2023 Notes in exchange of 2019 Notes

Extinguished 2019 Notes

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

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Organization and Nature of Business

Repligen Corporation (NASDAQ:RGEN) is a global life sciences company that develops and commercializes highly innovative bioprocessing technologies and systems that increase efficiencies and flexibility in the process of manufacturing biological drugs.

The Company’s franchises include filtration, chromatography, process analytics and proteins.

Repligen Corporation (NASDAQ:

RGEN) is a global life sciences company that develops and commercializes highly innovative bioprocessing technologies and systems that increase efficiencies and flexibility in the process of manufacturing biological drugs.

The Company’s franchises include filtration, chromatography, process analytics and proteins.

See Part I, Item 1.

“ Business - Our Products”, of this report for additional information related to the Company's products.

The Company’s bioprocessing products are sold to major life sciences companies, biopharmaceutical development companies and contract manufacturing organizations worldwide.

The Company operates under one reportable segment.

The Company’s chief operating decision maker (“CODM”) reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance.

See Note 2, “Summary of Significant Accounting Policies –

Segment Reporting,”

for more information on the Company’s segment.

The Company’s chief operating decision maker (“CODM”), its Chief Executive Officer (“CEO”), reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance.

See Note 2, “Summary of Significant Accounting Policies – Segment Reporting,” for more information on the Company’s segment.

A majority of our 19 manufacturing sites are located in the United States (California, Massachusetts, New Hampshire, New Jersey, New York and Texas).

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The Company is subject to a number of risks typically associated with companies in the biotechnology industry.

These risks principally include the Company’s dependence on key customers, development by the Company or its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with the U.S.

Food and Drug Association and other governmental regulations and approval requirements, as well as the ability to grow the Company’s business and obtain adequate funding to finance this growth.

Summary of Significant Accounting Policies

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The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

Significant estimates and assumptions by management affect the Company’s revenue recognition for multiple element arrangements, allowance for credit losses, the net realizable value of inventory, valuations and purchase price allocations related to business combinations, expected future cash flows including growth rates, discount rates, terminal values and other assumptions and estimates used to evaluate the recoverability of long-lived assets, contingent consideration, estimated fair values of intangible assets and goodwill, amortization methods and periods, warranty reserves, certain accrued expenses, stock-based compensation, tax reserves and recoverability of the Company’s net deferred tax assets and related valuation allowance.

Significant estimates and assumptions by management affect the Company’s revenue recognition for multiple element arrangements, allowance for credit losses, the net realizable value of inventory, valuations and purchase price allocations related to business combinations, contingent consideration, estimated fair values of intangible assets and goodwill, amortization methods and periods, warranty reserves, certain accrued expenses, estimates related to the fair value of the conversion features of the convertible notes for purposes of assessing whether debt extinguishment or modification accounting applies to the Company’s debt exchange, stock-based compensation, tax reserves and recoverability of the Company’s net deferred tax assets and related valuation allowance.

Although the Company regularly assesses these estimates, actual results could differ materially from these estimates.

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Basis of Presentation

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Repligen Sweden AB, Repligen GmbH, Spectrum LifeSciences LLC and its subsidiaries (“Spectrum”), C Technologies, Inc.

("C Technologies"), ARTeSYN Biosolutions Holdings Ireland Ltd., ARTeSYN Biosolutions Ireland Limited and its subsidiaries (“ARTeSYN”), Polymem S.A.

(“Polymem”), Avitide, LLC (“Avitide”), Newton T&M Corp ("NTM"), Bio-Flex Solutions, LLC ("BioFlex"), Repligen Singapore Pte.

and Repligen UK Limited.

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries.

All significant intercompany accounts and transactions have been eliminated in consolidation.

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Revenues and expenses are translated at average rates in effect during the reporting period.

Translation adjustments, including adjustments related to the Company’s various intercompany loans.

Any intercompany loans with foreign subsidiaries are remeasured at each period end and included in accumulated other comprehensive loss on the consolidated balance sheets.

Translation adjustments include adjustments related to the Company’s various intercompany loans with foreign subsidiaries.

Intercompany loans determined to be permanent are remeasured at each period end and included in accumulated other comprehensive loss on the consolidated balance sheets.

Intercompany loans with foreign subsidiaries determined to be repayable are remeasured at each period end and included in other income (expenses) on the consolidated statements of comprehensive income.

Revenue Recognition

We generate revenue from the sale of bioprocessing products, equipment devices, and related consumables used with these equipment devices to customers in the life sciences and biopharmaceutical industries.

The Company generates revenue from the sale of bioprocessing products, equipment devices, and related consumables used with these equipment devices to customers in the life sciences and biopharmaceutical industries.

Under Accounting Standard Codification No.

(“ASC”) 606, “

Revenue from Contracts with Customers,”

revenue is recognized when, or as, obligations under the terms of a contract are satisfied, which occurs when control of the promised products or services is transferred to customers.

Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products or services to a customer (“transaction price”).

(“ASC”) 606, “ Revenue from Contracts with Customers,” revenue is recognized when, or as, obligations under the terms of a contract are satisfied, which occurs when control of the promised products or services is transferred to customers.

Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products or services to a customer (“transaction price”).

To the extent the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing the expected value method or the most likely amount method, depending on the facts and circumstances relative to the contract.

Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur.

Estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of the Company’s anticipated performance and all information (historical, current and forecasted) that is reasonably available.

Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur.

Sales, value add, and other taxes collected on behalf of third parties are excluded from revenue.

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Applying the practical expedient in paragraph 606-10-32-18, the Company does not assess whether a significant financing component exists if the period between when the Company performs its obligations under the contract and when the customer pays is one year or less.

None of the Company’s contracts contained a significant financing component as of December 31, 2022.

None of the Company’s contracts contained a significant financing component as of December 31, 2023.

Contracts with customers may contain multiple performance obligations.

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Highly liquid investments in money market mutual funds with an original maturity of three months or less are classified as cash equivalents.

All cash equivalents are carried at cost, which

approximates fair value.

All cash equivalents are carried at cost, which approximates fair value.

Restricted cash represents cash that is restricted as to withdrawal or usage.

There was no restriction on the Company’s cash balance as of December 31, 2022 and 2021.

The Company’s cash, cash equivalents and restricted cash total as presented in the Company’s consolidated statements of cash flows for the years ended December 31, 2022, 2021 and 2020 was $ 523.5 million, $ 603.8 million and $ 717.3 million, respectively.

The beginning cash, cash equivalents and restricted cash balance of $ 537.4 million on the consolidated statement of cash flows for the year ended December 31, 2020 includes $ 9.0 million in restricted cash, which represented cash held and due to employees based on their continued employment with the Company one year after the acquisition of C Technologies in 2019.

The amount was subsequently paid to employees during 2020.

I nvestment Securities

There was no restriction on the Company’s cash balance as of December 31, 2023 and 2022.

The Company’s cash, cash equivalents and restricted cash total as presented in the Company’s consolidated statements of cash flows for the years ended December 31, 2023, 2022 and 2021 was $ 751.3 million, $ 523.5 million and $ 603.8 million, respectively.

Investment Securities

We classify our investment securities in one of three categories:

held to maturity, trading, or available for sale.

Our investment portfolio at December 31, 2022 consists of an investment in U.S.

treasury bills classified as held to maturity which is included in the Company's consolidated balance sheets under marketable securities held to maturity.

Securities that we have the positive intent and ability to hold to maturity are classified as held to maturity and stated at amortized cost in the consolidated balance sheet.

Our investment portfolio at December 31, 2022 consisted of an investment in U.S.

treasury bills classified as held to maturity which was included in the Company's consolidated balance sheets under marketable securities held to maturity.

These marketable securities matured in June 2023 and there are no comparable investments as of December 31, 2023.

Securities that we have the positive intent and ability to hold to maturity are classified as held to maturity and stated at amortized cost in the consolidated balance sheets.

Management determines the appropriate classification of securities at the time of purchase based upon management's intent with regards to such investment and reevaluates such designation as of each balance sheet date.

The Company's investment policy requires that it only invest in high-rated securities and limit its exposure to any single-user.

Currently, all investment securities are held-to-maturity and are carried at amortized cost on the Company's consolidated balance sheet as of December 31, 2022, as marketable securities held to maturity.

There were no realized or unrealized gains or losses on investments recorded as of December 31, 2023, 2022 and 2021.

The Company classifies marketable securities as short-term when they have remaining contractual maturities of one year or less from the balance sheet date.

The Company periodically assesses its marketable securities for impairment or credit losses.

The Company periodically assesses its marketable securities, if any, for impairment or credit losses.

Fair Value Measurement

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Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company.

Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances.

The fair value hierarchy is broken down into three levels based on the source of inputs as follows:

Level 1 –

Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

Level 2 –

Valuations based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and models for which all significant inputs are observable, either directly or indirectly.

Level 3 –

Valuations based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities.

Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

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Losses are charged against the allowance when the customer accounts are determined to be uncollectible.

Inventories relate to the Company’s bioprocessing business.

The Company values inventory at cost or, if lower, net realizable value, using the first-in, first-out method.

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Manufacturing of bioprocessing finished goods is done to order and tested for quality specifications prior to shipment.

A change in the estimated timing or amount of demand for the Company’s products could result in additional provisions for excess inventory quantities on hand.

Any significant unanticipated changes in demand or unexpected quality failures could have a significant impact on the value of inventory and reported operating results.

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The Company adopted Accounting Standards Update No.

("ASU") 2016-02, “Leases (Topic 842) ”

(“ASC 842”) as of January 1, 2019.

(“ASU”) 2016-02, “Leases (Topic 842) ” (“ASC 842”) as of January 1, 2019.

Under ASC 842, the Company determines whether the arrangement contains a lease at the inception of an arrangement.

If a lease is identified in an arrangement, the Company recognizes a right-of-use asset and liability on its consolidated balance sheet and determines whether the lease should be classified as a finance or operating lease.

If a lease is identified in an arrangement, the Company recognizes a right-of-use asset and liability on its consolidated balance sheets and determines whether the lease should be classified as a finance or operating lease.

The Company does not recognize assets or liabilities for leases with lease terms of less than 12 months.

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If a lease includes an option to extend or terminate the lease, the Company reflects the option in the lease term if it is reasonably certain it will exercise the option.

Finance leases are recorded in property, plant and equipment, net, other current liabilities and long-term finance lease liabilities and operating leases are recorded in operating lease right of use assets, operating lease liability and operating lease liability, long-term on the Company’s consolidated balance sheet.

Certain of the Company’s operating leases where the Company is the lessee provide for minimum annual payments that increase over the life of the lease.

Some of these leases include obligations to pay for other services, such as operations and maintenance.

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The aggregate minimum annual payments are expensed on the straight-line basis beginning when the Company takes possession of the property and extending over the term of the related lease, including renewal options when the exercise of the option is reasonably certain as an economic penalty may be incurred if the option is not exercised.

The Company also accounts in its straight-line computation for the effect of any “rental holidays.”

Operating lease assets represent 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.

The Company also accounts in its straight-line computation for the effect of any “rental holidays.”

Operating lease assets and liabilities are recognized at the lease commencement date based on the estimated present value of the fixed lease payments, reduced by landlord incentives using a discount rate based on similarly secured borrowings available to the Company.

Most of the leases do not provide implicit interest rates and therefore the Company determines the discount rate based on its incremental borrowing rate.

The incremental borrowing rate for the Company’s leases is determined based on lease term and currency in which the lease payments are made.

Accrued Liabilities

The Company estimates accrued liabilities by identifying services performed on the Company’s behalf, estimating the level of service performed and determining the associated cost incurred for such service as of each balance sheet date.

For example, the Company would accrue for professional and consulting fees incurred with law firms, audit and accounting service providers and other third-party consultants.

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The date on which certain services commence, the level of services performed on or before a given date, and the cost of such services often require the exercise of judgment.

The Company makes these judgments based upon the facts and circumstances known at the date of the financial statements.

Deferred taxes are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse.

The Company makes these judgments based upon the facts and circumstances known at the date of the consolidated financial statements.

Deferred taxes are determined based on the difference between the consolidated financial statements and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse.

Valuation allowances are provided, if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

The Company accounts for uncertain tax positions using a “more-likely-than-not”

threshold for recognizing and resolving uncertain tax positions.

The Company accounts for uncertain tax positions using a “more-likely-than-not” threshold for recognizing and resolving uncertain tax positions.

The evaluation of uncertain tax positions is based on factors including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, new audit activity and changes in facts or circumstances related to a tax position.

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Potential common share equivalents consist of restricted stock awards (including performance stock units) and the incremental common shares issuable upon the exercise of stock options and warrants.

Under the treasury stock method, unexercised “in-the-money”

stock options are assumed to be exercised at the beginning of the period or at issuance, if later.

Under the treasury stock method, unexercised “in-the-money” stock options are assumed to be exercised at the beginning of the period or at issuance, if later.

The assumed proceeds are then used to purchase common shares at the average market price during the period.

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Earnings per share:

For the years ended December 31, 2022, 2021 and 2020 , 177,318 shares, 68,968 shares and 98,048 shares, respectively, of the Company’s common stock were excluded from the calculation of diluted earnings per share because they would have had an anti-dilutive effect for years presented.

In July 2019, the Company issued $ 287.5 million aggregate principal amount of our 0.375% Convertible Senior Notes due 2024 (the "2019 Notes").

As provided by the terms of the indenture underlying the 2019 Notes, prior to March 4, 2022, conversion of the 2019 Notes could have been settled in cash, shares of the Company’s common stock or a combination thereof, at the Company’s election.

(1) Represents the dilutive impact for the Company's 0.375 % Convertible Senior Notes due 2024 (the “ 2019 Notes”) and its 1.00 % Convertible Senior Notes due 2028 (the “2023 Notes”).

As of December 31, 2023, the if-converted value is less than the outstanding principal of the 2023 Notes and are therefore anti-dilutive.

Refer to Note 14, “ Convertible Senior Notes,” for more information.

For the years ended December 31, 2023, 2022 and 2021, 306,849 shares, 177,318 shares and 68,968 shares, respectively, of the Company’s common stock were excluded from the calculation of diluted earnings per share because they would have had an anti-dilutive effect for years presented.

In July 2019, the Company issued $ 287.5 million aggregate principal amount of its 2019 Notes.

On March 4, 2022, we entered into the Second Supplemental Indenture for the 2019 Notes, which irrevocably elected to settle the conversion of the 2019 Notes using a combination of cash and shares of the Company's common stock, settling the par value of the 2019 Notes in cash and any excess conversion premium in shares.

On December 14, 2023, the Company exchanged, in a privately negotiated exchange, $ 309.9 million principal amount of 2023 Notes for $ 217.7 million principal amount of 2019 Notes and issued $ 290.1 million aggregate principal amount of 2023 Notes for $ 290.1 million in cash.

Following the close of the Exchange Transaction, $ 69.7 million in aggregate principal amount of 2019 Notes remains outstanding with terms unchanged.

As provided by the terms of the Second Supplemental Indenture underlying the 2019 Notes, the Company irrevocably elected to settle the conversion obligation for the 2019 Notes in a combination of cash and shares of the Company's common stock.

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Under ASU 2020-06, the Company is required to reflect the dilutive effect of the convertible securities by application of the “if-converted” method, which means the denominator of the EPS calculation would include the total number of shares assuming the 2019 Notes had been fully converted at the beginning of the period.

Prior to March 4, 2022, the Company had the choice to settle the conversion of the 2019 Notes in cash, stock or a combination of the two.

Prior to March 4, 2022, the Company had the choice to settle the

conversion of the 2019 Notes in cash, stock or a combination of the two.

Therefore, from January 1, 2022 (the date the Company adopted ASU 2020-06) to March 4, 2022, the Company included 3,474,429 shares in the denominator of the EPS calculation, applying the if converted method.

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Under the if-converted method of calculating dilutive shares, the Company was also required to exclude amortization of debt issuance costs and interest charges applicable to the convertible debt from the numerator of the dilutive EPS calculation for the period from January 1, 2022 to March 4, 2022, as if the interest on convertible debt was never recognized for that period.

For the year ended

December 31, 2022, the Company excluded interest charges of $ 0.4 million (net of tax) from the numerator and included 1,359,957 shares in the calculation of diluted earnings as the dilutive effect of the conversion premium.

Prior to the adoption of ASU 2020-06, the Company applied the provisions of ASC 260-10-45-44, to determine the diluted weighted average shares outstanding as it related to the conversion spread on its convertible notes.

As a result, the Company excluded interest charges of $ 0.4 million (net of tax) from the numerator and included 1,359,957 shares in the calculation of diluted earnings as the dilutive effect of the conversion premium for the year ended December 31, 2022.

There were no comparable amounts included in 2023 or 2021.

Prior to the adoption of ASU 2020-06, the Company applied the provisions of ASC 260, “ Earnings Per Share,” subsection 10-45-44, to determine the diluted weighted average shares outstanding as it related to the conversion spread on its convertible notes.

Accordingly, the par value of the 2019 Notes was not included in the calculation of diluted EPS, but the dilutive effect of the conversion premium was considered in the calculation of diluted EPS using the treasury stock method.

The dilutive impact of the 2019 Notes was based on the difference between the Company’s current period average stock price and the conversion price of the convertible notes, provided there is a premium.

Pursuant to this accounting standard, there was no dilution from the accreted principal of the 2019 Notes.

For the years ended December 31, 2021 and 2020, the dilutive effect of the conversion premium included in the calculation of diluted earnings was 1,253,168 shares and 366,534 shares, respectively.

Segment Reporting

Operating segments are components of an enterprise that engage in business activities for which discrete financial information is available and regularly reviewed by the CODM in deciding how to allocate resources and assess performance.

Our CEO has been identified as our CODM.

The Company views its operations, makes decisions regarding how to allocate resources and manages its business as one reportable segment and one reporting unit.

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Total product revenue

(1) 2021 revenue for filtration products includes revenue related to Polymem from July 1, 2021, as well as BioFlex and NTM from December 16, 2021 through December 31, 2021.

2021 revenue for proteins products includes revenue related to Avitide from September 20, 2021 through December 31, 2021.

(2) 2020 revenue for filtration products includes revenue related to EMT from July 13, 2020, NMS from October 20, 2020, and ARTeSYN from December 3, 2020 through December 31, 2020.

(3) Revised 2020 revenue in the table above reflects a shift in product revenue from chromatography products to proteins products of approximately $ 3 million.

These changes are consistent with the current year presentation of product revenue.

(1) 2023 revenue for filtration products includes revenue related to FlexBiosys, Inc.

(“FlexBiosys”) from April 17, 2023, as well as Metenova Holding AB (“Metenova”) from October 2, 2023.

(2) 2021 revenue for filtration products includes revenue related to Polymem S.A.

(“Polymem”) from July 1, 2021, as well as BioFlex Solutions LLC (“BioFlex”) and Newton T&M Corp.

(“NTM”) from December 16, 2021 through December 31, 2021.

2021 revenue for proteins products includes revenue related to Avitide, Inc.

(“Avitide”) from September 20, 2021 through December 31, 2021.

Revenue from filtration products includes the XCell ATF ® systems and consumables as well as the KrosFlo ® and SIUS ® filtration products.

Revenue from chromatography products includes the OPUS ® chromatography pre-packed columns ("PPC"), chromatography resins and ELISA test kits.

Revenue from process analytics products includes the SoloVPE ® , FlowVPE ® and FlowVPX ® devices.

Revenue from chromatography products includes the OPUS ® chromatography pre-packed columns, chromatography resins and ELISA test kits.

Revenue from process analytics products includes the SoloVPE ® , FlowVPE ® RPM ® and FlowVPX ® devices.

Revenue from protein products includes the Protein A affinity ligands and cell culture growth factors.

Other revenue primarily consists of revenue from the sale of operating room products to hospitals as well as freight revenue.

The following table represents the Company’s total revenue by our country of domicile (the United States) and other countries where our major subsidiaries are domiciled for the periods presented (based on the location of the customer):

For the Years Ended December 31,

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Total revenue

The following table represents the Company’s total assets by our country of domicile (the United States) and other countries where our major subsidiaries are domiciled for the periods presented:

(Amounts in thousands)

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Total assets by geographic location

The following table represents the Company’s long-lived assets by our country of domicile (the United States) and other countries where our major subsidiaries are domiciled for the periods presented:

(Amounts in thousands)

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Financial instruments that subject the Company to significant concentrations of credit risk primarily consist of cash and cash equivalents, marketable securities and accounts receivable.

Per the Company’s investment policy, cash equivalents and marketable securities are invested in financial instruments with high credit ratings, limit its credit exposure to any one issuer (with the exception of U.S.

treasury obligations) and type of instrument is limited.

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While a reserve for the potential write-off of accounts receivable is maintained, the Company has not written off any significant accounts to date.

To control credit risk, the Company performs regular credit evaluations of its customers’

financial condition.

There was no revenue from customers that represented 10 % or more of the Company's total revenue for the year ended December 31, 2022.

To control credit risk, the Company performs regular credit evaluations of its customers’ financial condition.

There was no revenue from customers that represented 10 % or more of the Company's total revenue for the year ended December 31, 2023 or 2022.

Revenue from Pfizer Inc.

accounted for 10 % of total revenue for the year ended December 31, 2021, and MilliporeSigma accounted for 11 % of total revenues in the year ended December 31, 2020.

Significant accounts receivable balances representing 10 % or more of the Company’s total trade accounts receivable balances at December 31, 2022 and 2021 is as follows:

Purolite (an Ecolab Inc.

accounted for 10 % of total revenue for the year ended December 31, 2021.

No accounts receivable balance from a specific customer represented 10 % or more of the Company's total trade accounts receivable at December 31, 2023 .

Significant accounts receivable balances representing 10 % or more of the Company’s total

trade accounts receivable balances at December 31, 2022 came from our accounts receivable balance outstanding with Purolite, an Ecolab Inc.

company (“Purolite”), which was 12.7 % of the Company's total trade accounts receivable balance.

Business Combinations, Goodwill and Intangible Assets

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Any excess of purchase price over the fair value of the net tangible and intangible assets acquired is allocated to goodwill.

While the Company uses its best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date as well as any contingent consideration, where applicable, the Company’s estimates are inherently uncertain and subject to refinement.

As a result, during the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill.

Upon conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statements of comprehensive income.

Any excess of the fair value of the net tangible and intangible assets acquired over the purchase price is recognized in the consolidated statements of comprehensive income.

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Management updates these estimates and the related fair value of contingent consideration at each reporting period.

These changes in the fair value of contingent consideration are recorded to contingent consideration expense in our consolidated statements of comprehensive income.

For the years ended December 31, 2022 and 2021 , we recorded ($ 28.7 ) million and $ 5.9 million, respectively, of contingent consideration expense related to the change in estimated contingent consideration obligation related to the acquisition of Avitide (the "Avitide Acquisition").

These changes in the fair value of contingent consideration are recorded to contingent consideration in the Company’s consolidated statements of comprehensive income.

For the years ended December 31, 2023 and 2022 , we recorded a decrease of $ ( 30.6 ) million and $ ( 28.7 ) million, respectively, to the estimated contingent consideration obligation, primarily related to the acquisition of Avitide (the “Avitide Acquisition”).

The Company uses the income approach to determine the fair value of certain identifiable intangible assets including customer relationships and developed technology.

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Discount rates used to arrive at a present value as of the date of acquisition are based on the time value of money and certain industry-specific risk factors.

The Company believes the estimated purchased customer relationships, developed technologies, trademark/tradename, patents, non-compete agreements and in-process research and development ("R&D") amounts so determined represent the fair value at the date of acquisition, and do not exceed the amount a third-party would pay for such assets.

The Company believes the estimated purchased customer relationships, developed technologies, trademark/tradename, patents, non-compete agreements and in-process research and development amounts so determined represent the fair value at the date of acquisition, and do not exceed the amount a third-party would pay for such assets.

Goodwill is not amortized and is tested for impairment at least annually at the reporting unit level.

The Company operates as one reporting unit as of the goodwill impairment measurement date of December 31, 2023.

During the qualitative assessment of the Company’s one reporting unit during the 2022 goodwill impairment testing, it was determined that it was not more likely than not that its fair value was less than its carrying amount.

During the qualitative assessment of the Company’s one reporting unit during the 2023 goodwill impairment testing, it was determined that it was not more likely than not that its fair value was less than its carrying amount.

As such, a quantitative impairment assessment was not required as of December 31, 2023.

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There was no impairment to goodwill and therefore no impairment charge recorded for the years ended December 31, 2023, 2022 and 2021.

The Company has historically tested for impairment on its goodwill annually as of its measurement date of December 31st pursuant to company policy.

Subsequent to the 2023 annual impairment test, the Company voluntarily changed its annual impairment assessment date from December 31st to October 1st, the first day of the Company's fourth quarter, beginning on October 1, 2024 .

The change is being made to better align the annual impairment assessment date with the Company's annual planning and budgeting process as well as long-term planning and forecasting process.

The Company has determined this voluntary change in accounting principle is preferable and will not impact its consolidated financial statements nor is it being done to accelerate, avoid or trigger an impairment charge.

This change is not going to be applied retrospectively as it is

impracticable to do so because retrospective application would require application of significant estimates and assumptions with the use of hindsight.

Accordingly, the change will be applied prospectively.

Intangible Assets

Intangible assets with a definite life are amortized over their useful lives using the straight-line method and the amortization expense is recorded within cost of product revenue, research and development and selling, general and administrative expense in the consolidated statements of comprehensive income.

Intangible assets with a definite life are amortized over their useful lives using the straight-line method and the amortization expense is recorded within cost of product revenue, research and development (“R&D”) and selling, general and administrative expense in the consolidated statements of comprehensive income.

Intangible assets and their related useful lives are reviewed at least annually to determine if any adverse conditions existed that would indicate the carrying value of these assets may not be recoverable.

More frequent impairment assessments are conducted if certain conditions exist, including a change in the competitive landscape, any internal decisions to pursue new or different technology strategies, a loss of a significant customer, or a significant change in the marketplace, including changes in the prices paid for the Company’s products or changes in the size of the market for the Company’s products.

If impairment indicators are present, the Company determines whether the underlying

intangible asset is recoverable through estimated future undiscounted cash flows.

If impairment indicators are present, the Company determines whether the underlying intangible asset is recoverable through estimated future undiscounted cash flows.

If the asset is not found to be recoverable, it is written down to the estimated fair value of the asset based on the sum of the future discounted cash flows expected to result from the use and disposition of the asset.

If the estimate of an intangible asset’s remaining useful life is changed, the remaining carrying amount of the intangible asset is amortized prospectively over the revised remaining useful life.

The Company continues to believe that its definite-lived intangible assets are recoverable at December 31, 2023.

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Stock Based Compensation

The Company measures stock-based compensation cost at the grant date based on the estimated fair value of the award and recognizes it as an expense over the employee’s requisite service period on a straight-line basis.

The Company records the expense for share-based awards subject to performance-based milestone vesting over the remaining service period when management determines that achievement of the milestone is probable.

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The following assumptions are used in calculating the fair value of share-based awards:

Expected term –

The expected term of options granted represents the period of time for which the options are expected to be outstanding.

Expected term – The expected term of options granted represents the period of time for which the options are expected to be outstanding.

For purposes of estimating the expected term, the Company has aggregated all individual option awards into one group as the Company does not expect substantial differences in exercise behavior among its employees.

Expected volatility –

The expected volatility is a measure of the amount by which the Company’s stock price is expected to fluctuate during the expected term of options granted.

The Company determines the expected volatility based primarily upon the historical volatility of the Company’s common stock over a period commensurate with the option’s expected term.

Risk-free interest rate –

The risk-free interest rate is the implied yield available on U.S.

treasury zero-coupon issues with a remaining term equal to the option’s expected term on the grant date.

Expected dividend yield –

The Company has never declared or paid any cash dividends on any of its capital stock and does not expect to do so in the foreseeable future.

Expected volatility – The expected volatility is a measure of the amount by which the Company’s stock price is expected to fluctuate during the expected term of options granted.

The Company determines the expected volatility based primarily upon the historical volatility of the Company’s common stock over a period commensurate with the option’s expected term.

Risk-free interest rate – The risk-free interest rate is the implied yield available on U.S.

treasury zero-coupon issues with a remaining term equal to the option’s expected term on the grant date.

Expected dividend yield – The Company has never declared or paid any cash dividends on any of its capital stock and does not expect to do so in the foreseeable future.

Accordingly, the Company uses an expected dividend yield of zero to calculate the grant-date fair value of a stock option.

Estimated forfeiture rates –

The Company has applied, based on an analysis of its historical forfeitures, annual forfeiture rates of 8 % for awards granted to non-executive level employees, 3 % for awards granted to executive level employees and 0 % for awards granted to non-employee members of the Board of Directors to all unvested stock options as of December 31, 2022 .

Estimated forfeiture rates – The Company has applied, based on an analysis of its historical forfeitures, annual forfeiture rates of 8 % for awards granted to non-executive level employees, 3 % for awards granted to executive level employees and 0 % for awards granted to non-employee members of the Board of Directors (“Board”) to all unvested stock options as of December 31, 2023 .

The Company reevaluates this analysis periodically and adjusts these estimated forfeiture rates as necessary.

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Recent Accounting Standards Updates

We consider the applicability and impact of all ASUs on the Company’s consolidated financial statements.

Updates not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s consolidated financial position or results of operations.

Recently issued Accounting Standards Updates that we feel may be applicable to the Company are as follows:

Recently Issued Accounting Standard Updates –

Adopted During the Fiscal Year

Effective January 1, 2022, the Company adopted ASU 2020-06, “

Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40)”

using the modified retrospective method of adoption.

ASU 2020-06 simplifies the accounting for convertible debt instruments and convertible preferred stock by reducing the number of accounting models and the number of embedded conversion features that could be recognized separately from the primary contract.

Consequently, a convertible instrument is now accounted for as a single liability measured at its amortized cost as long as no other features of such convertible instrument require bifurcation and recognition as derivatives.

By removing those separation models, the interest rate of convertible debt instruments will typically be closer to the coupon interest rate when applying the guidance in Topic 835, “Interest.”

The Company now accounts for its 0.375% convertible senior notes due July 15, 2024 (the "2019 Notes") as a single liability measured at amortized cost.

As a result, the adoption of ASU 2020-06 had a material impact on the Company's consolidated financial statements, resulting in adjustments of $ 39.1 million, $ 17.3 million and $ 27.6 million to the opening balances of additional paid-in capital, retained earnings and Convertible Senior Notes, net, respectively, on the Company's consolidated balance sheet as of January 1, 2022.

Additionally, due to the adoption of ASU 2020-06, the Company reversed the remaining balance of the deferred tax liability of $ 6.4 million, which was initially recorded in connection with the 2019 Notes.

See Note 13, “Convertible Senior Notes,”

for more information, including our modified disclosures as required by ASU 2020-06 upon adoption.

We consider the applicability and impact of all ASUs and other accounting guidance on the Company’s consolidated financial statements.

Updates not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company’s consolidated financial position or results of operations.

Recently issued accounting guidance that we feel may be applicable to the Company are as follows:

Recently Issued Accounting Guidance – Adopted During the Fiscal Year

In July 2023, the U.S.

Securities and Exchange Commission (the “SEC”) adopted the final rule under SEC Release No.

33-11216, “ Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure,” requiring current reporting about material cybersecurity incidents and annual disclosures on management’s processes for assessing, identifying, and managing material cybersecurity risks, the material impacts of cybersecurity threats and previous cybersecurity incidents, the Board's oversight of cybersecurity risks, and management’s role and expertise in assessing and managing material cybersecurity risks.

SEC Release No.

33-11216 was effective for us during the third quarter of 2023.

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

In December 2022, the SEC adopted the final rule under SEC Release No.

33-11138, "Insider Trading Arrangements and Related Disclosures ," which requires new disclosures regarding insider trading policies and procedures, the use of Rule 10b5-1 plans by directors and officers, and stock option grants issued in close proximity to the release of material nonpublic information.

SEC Release No.

33-11138 was effective for us for our second quarter of 2023, and did not have a material impact on our consolidated financial statements and disclosures.

Recently Issued Accounting Guidance – Not Yet Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, “ Income Taxes (Topic 740) - Improvements to Income Tax Disclosures.” ASU 2023-09 enhances the transparency and decision usefulness of income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction.

ASU 2023-09 will be effective for the Company in its income tax disclosure included in its 2025 Annual Report on Form 10-K and will be applied on a prospective basis.

However, retrospective application is permitted.

Early adoption is also permitted.

Besides a change in income tax disclosures, the Company does not expect the adoption of ASU 2023-09 to have a material impact on its consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07, “S egment Reporting (Topic 820) - Improvements to Reportable Segment Disclosures.” ASU 2023-07 will improve reportable segment disclosure requirements, primarily through enhanced annual and interim disclosures about significant segment expenses that are regularly provided to the CODM.

The disclosure required under ASU 2023-07 are also required for public entities with a single reportable segment.

ASU 2023-07 will be effective for the Company for annual periods beginning on January 1, 2024 and interim periods beginning on January 1, 2025.

The amendments of this guidance apply retrospectively to all prior periods presented in the consolidated financial statements.

Early adoption is

Besides presentation in the segment footnote for its interim reporting, the Company does not expect the adoption of ASU 2023-07 to have a material impact on its consolidated financial statements.

Fair Value Measurements

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As of December 31, 2023

(Amounts in thousands)

Cash and cash equivalents:

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Total cash and cash equivalents

As of December 31, 2022

Cash and cash equivalents:

Cash and money market funds

Total cash and cash equivalents

Marketable securities held to maturity:

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treasury bills with the positive intent and ability to hold them until maturity.

Therefore, the Company classified this investment as held to maturity and stated it at amortized cost on the consolidated balance sheet.

Therefore, the Company classified this investment as held to maturity and stated it at amortized cost on the consolidated balance sheets.

There is no comparable investment as of December 31, 2023.

The amortized cost and fair value of the Company's held to maturity securities by contractual maturity at December 31, 2022 are summarized below.

There is no comparable investment as of December 31, 2021:

There were no comparable investments as of December 31, 2023:

December 31, 2022

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Money market accounts

Short-term contingent consideration

Long-term contingent consideration

Contingent Consideration –

On September 20, 2021, the Company completed the Avitide Acquisition.

Avitide is a privately-held affinity ligand discovery and development company headquartered in Lebanon, New Hampshire.

The transaction consisted of upfront payments of $ 150.0 million and up to an additional $ 125.0 million (undiscounted) in contingent consideration earnout payments made equally in cash and the Company's common stock over a three-year performance period beginning January 1, 2022 and ending December 31, 2024.

See Note 4, "Acquisitions" below for additional information.

During 2022, a change in market inputs and a shift in revenue and volume projections, due to the expected timing of achievement over the three-year performance period, resulted in a material change in amounts reported as of December 31, 2022 .

A reconciliation of the change in fair value of contingent consideration –

earnout is included in the following table (amounts in thousands):

Contingent Consideration – Earnout

As of December 31, 2023, the maximum amount of future contingent consideration (undiscounted) that the Company could be required to pay in connection with each of the completed acquisitions is;

$ 125.0 million over a three-year earnout period for Avitide, which was acquired in September 2021 and for which the earnout periods run from January 1, 2022 through December 31, 2024;

$ 42.0 million over a two-year earnout period for FlexBiosys, which was acquired in April 2023 and for which the earnout periods run from January 1, 2023 through December 31, 2024;

and approximately $ 10 million over a one-year earnout period for Metenova, which was acquired in October 2023 and for which the earnout period runs from January 1, 2024 through December 31, 2024.

See Note 4, “ Acquisitions” to this report for more information on the contingent consideration earnouts.

During 2023, expected results and change in market inputs used to calculate the discount rate, resulted in a decrease in amounts reported as of December 31, 2023 .

A reconciliation of the change in fair value of contingent consideration – earnout is included in the following table (amounts in thousands):

Balance at December 31, 2022

Acquisition date fair value of contingent consideration earnouts

Payment of contingent consideration earnouts

Decrease in fair value of contingent consideration earnouts

Balance at December 31, 2023

The recurring Level 3 fair value measurement of our contingent consideration –

earnout that we expect to be required to settle, include the following significant unobservable inputs:

The recurring Level 3 fair value measurement of our contingent consideration – earnout that we expect to be required to settle our 2023, 2024 and 2025 contingent consideration obligation for Avitide, FlexBiosys and Metenova include the following significant unobservable inputs (amounts in thousands, except percent data):

Contingent Consideration Earnout

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Probability of

Commercialization-based

Commercialization-based payments

Earnout Discount Rate

12.5 %- 24.6 %

Revenue and Volume-

Revenue & Volume

based payments

Revenue & Volume

Discount Rate

Earnout Discount Rate

Probability of

Manufacturing line expansions

Probability-weighted present value

Earnout Discount Rate

(1) Unobservable inputs were weighted by the relative fair value of the contingent consideration liability.

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The 2019 Notes will mature on July 15, 2024, unless earlier converted or repurchased in accordance with their terms.

At December 31, 2022, the carrying value of the 2019 Notes was $ 284.6 million, net of unamortized debt issuance costs and the fair value of the 2019 Notes was $ 452.0 million.

At December 31, 2021 , prior to the adoption of ASU 2020-06, the carrying value of the 2019 Notes was $ 255.3 million, net of unamortized discount and unamortized issuance costs, and the fair value of the 2019 Notes was $ 678.5 million.

At December 31, 2023 and 2022, subsequent to the adoption of ASU 2020-06, the carrying value of the 2019 Notes was $ 69.5 million and $ 284.6 million, respectively, net of unamortized debt issuance costs and the fair value of the 2019 Notes was $ 109.8 million and $ 452.0 million, respectively.

The fair value of the 2019 Notes is a Level 1 valuation and was determined based on the most recent trade activity of the 2019 Notes as of December 31, 2023 and 2022.

The 2019 Notes are discussed in more detail in Note 13, “Convertible Senior Notes,”

to these consolidated financial statements.

The 2019 Notes are discussed in more detail in Note 14, “Convertible Senior Notes,” to these consolidated financial statements.

On December 14, 2023, the Company issued $ 600.0 million aggregate principal amount of its 2023 Notes in a private placement pursuant to separate, privately negotiated exchange and subscription agreements (the “Exchange and Subscription Agreements”) with a limited number of holders of its outstanding 2019 Notes and certain other qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (“Securities Act”).

Pursuant to the Exchange and Subscription Agreements, the Company exchanged $ 217.7 million of its 2019 Notes for $ 309.9 million aggregate principal amount of the 2023 Notes (the “Exchange Transaction”) and issued $ 290.1 million aggregate principal amount of the 2023 Notes (the “Subscription Transactions”) for $ 290.1 million in cash.

At December 31, 2023, the carrying value of the 2023 Notes was $ 510.1 million, net of unamortized debt issuance costs, and the fair value of the 2023 Notes was $ 596.0 million.

The fair value of the 2023 Notes is a Level 1 valuation and was determined based on the most recent trade activity of the 2023 Notes as of December 31, 2023.

The 2023 Notes are discussed in more detail in Note 14, “ Convertible Senior Notes,” to these consolidated financial statements.

2023 Acquisitions

Metenova Holding AB

On October 2, 2023, the Company's subsidiary, Repligen Sweden AB acquired Metenova from the former shareholders of Metenova (the “Metenova Seller”) pursuant to a Share Sale and Purchase Agreement (the “Share Purchase Agreement”), dated as of September 23, 2023 (such acquisition, the “Metenova Acquisition”), by and among Repligen Sweden AB, the Metenova Seller, and the Company, in its capacity as guarantor of the obligations of Repligen Sweden AB under the Share Purchase Agreement.

Metenova, which is headquartered in Molndal, Sweden, offers magnetic mixing and drive train technologies that are widely used by global biopharmaceutical companies and contract development and manufacturing organizations.

The Metenova Acquisition further strengthens our fluid management portfolio with these products.

Consideration Transferred

The Company accounted for the Metenova Acquisition as a purchase of business under ASC 805, “ Business Combinations,” and the Company engaged a third-party valuation firm to assist with the valuation of Metenova.

Under the Share Purchase Agreement, all outstanding equity interests of Metenova were acquired for consideration with a value totaling $ 172.6 million.

The Metenova Acquisition was funded through payment of $ 164.5 million in cash, the issuance of 52,299 unregistered shares of the Company's common stock totaling $ 8.1 million and contingent consideration with an immaterial fair value.

Under the acquisition method of accounting, the assets acquired and liabilities assumed of Metenova were recorded as of the acquisition date, at their respective fair values, and consolidated with those of the Company.

The fair value of the net liabilities acquired is estimated to be $ 2.0 million, the fair value of the intangible assets acquired is estimated to be $ 58.8 million and the residual goodwill is estimated to be $ 115.8 million.

The estimated consideration and preliminary purchase price information has been prepared using a preliminary valuation.

Acquisition-related costs are not included as a component of consideration transferred but are expensed in the periods in which costs are incurred.

The Company has incurred $ 3.5 million of transaction and integration costs associated with the Metenova Acquisition from the date of acquisition to December 31, 2023.

The transaction costs are included in operating expenses in the consolidated statements of comprehensive income in 2023.

Fair Value of Net Assets Acquired

The preliminary allocation of purchase price is based on the fair value of assets acquired and liabilities assumed as of the acquisition date.

As of December 31, 2023, the purchase accounting for this acquisition had not been finalized.

As additional information becomes available, the Company may further revise its preliminary purchase price allocation during the remainder of the measurement period.

Besides tax implications of the purchase price allocation, the final allocation may result in changes to other assets and liabilities.

The components and estimated allocation of the purchase price consist of the following (amounts in thousands):

Cash and cash equivalents

Accounts receivable

Prepaid expenses and other current assets

Property and equipment

Operating lease right of use asset

Customer relationships

Developed technology

Trademark and tradename

Non-competition agreements

Accounts payable

Accrued liabilities

Operating lease liability

Deferred tax liability, long-term

Operating lease liability, long-term

Fair value of net assets acquired

Acquired Goodwill

The goodwill of $ 115.8 million represents future economic benefits expected to arise from anticipated synergies from the integration of Metenova into the Company.

These synergies include operating efficiencies and strategic benefits projected to be achieved as a result of the Metenova Acquisition.

Substantially all of the goodwill recorded is expected to be nondeductible for income tax purposes.

Intangible Assets

The following table sets forth the components of the identified intangible assets associated with the Metenova Acquisition and their estimated useful lives:

(Amounts in thousands)

Customer relationships

Developed technology

Trademark and tradename

Non-competition agreements

FlexBiosys, Inc.

On April 17, 2023 , the Company completed its acquisition of all of the outstanding equity interests in FlexBiosys, pursuant to an Equity Purchase Agreement with FlexBiosys, TSAP Holdings Inc.

(“NJ Seller”), Gayle Tarry and Stanley Tarry, as individuals (collectively with NJ Seller, the “FlexBiosys Sellers”), and Stanley Tarry, in his capacity as the representative of the FlexBiosys Sellers (the “FlexBiosys Acquisition”).

FlexBiosys, which is headquartered in Branchburg, New Jersey, offers expert design and custom manufacturing of single-use bioprocessing products and a comprehensive range of products that include bioprocessing bags, bottles, and tubing assemblies.

These products will complement and expand our fluid management portfolio of offerings.

Consideration transferred

The FlexBiosys Acquisition was accounted for as a purchase of a business under ASC 805, “ Business Combinations,” and the Company engaged a third-party valuation firm to assist with the valuation of FlexBiosys.

Under the terms of the EPA, all outstanding equity interests of FlexBiosys were acquired for consideration with a value totaling $ 41.0 million.

The FlexBiosys Acquisition was funded through payment of $ 29.0 million in cash, which includes $ 6.3 million deposited in escrow for future payments, the issuance of 31,415 unregistered shares of the Company's common stock totaling $ 5.4 million and contingent consideration with fair value of approximately $ 6.6 million.

Under the acquisition method of accounting, the assets acquired and liabilities assumed of FlexBiosys were recorded as of the acquisition date, at their respective fair values, and consolidated with those of the Company.

The fair value of the net assets acquired is estimated to be $ 14.1 million, the fair value of the intangible assets acquired is estimated to be $ 12.6 million and the residual goodwill is estimated to be $ 14.3 million.

The estimated consideration and preliminary purchase price information has been prepared using a preliminary valuation.

Acquisition-related costs are not included as a component of consideration transferred but are expensed in the periods in which costs are incurred.

The Company has incurred $ 1.1 million of transaction and integration costs associated with the FlexBiosys Acquisition from the date of acquisition to December 31, 2023 with $ 0.2 million of the transaction and integration costs incurred during the three months ended December 31, 2023.

The transaction costs are included in operating expenses in the consolidated statements of comprehensive income in 2023.

Fair Value of Net Assets Acquired

The preliminary allocation of purchase price is based on the fair value of assets acquired and liabilities assumed as of the acquisition date.

As of December 31, 2023, the purchase accounting for this acquisition had not been finalized.

As additional information becomes available, the Company may further revise its preliminary purchase price allocation during the remainder of the measurement period, which ends on April 17, 2024.

The final allocation may result in changes to other assets and liabilities.

The components and estimated allocation of the purchase price consist of the following (amounts in thousands):

Cash and cash equivalents

Accounts receivable

Prepaid expenses and other current assets

Property and equipment

Operating lease right of use asset

Customer relationships

Developed technology

Trademark and tradename

Non-competition agreements

Other long-term assets

Accounts payable

Accrued liabilities

Operating lease liability

Operating lease liability, long-term

Fair value of net assets acquired

During 2023, the Company recorded an immaterial net working capital adjustment related to the FlexBiosys Acquisition, which is included in goodwill in the table above.

Acquired Goodwill

The goodwill of $ 14.3 million represents future economic benefits expected to arise from anticipated synergies from the integration of FlexBiosys into the Company.

These synergies include operating efficiencies and strategic benefits projected to be achieved as a result of the FlexBiosys Acquisition.

Substantially all of the goodwill recorded is expected to be deductible for income tax purposes.

Intangible Assets

The following table sets forth the components of the identified intangible assets associated with the FlexBiosys Acquisition and their estimated useful lives:

(Amounts in thousands)

Customer relationships

Developed technology

Trademark and tradename

Non-competition agreements

2021 Acquisitions

BioFlex Solutions LLC and Newton T&M Corp.

On November 29, 2021, the Company entered into an Equity Purchase Agreement with Bioflex, NTM and each of Ralph Meola and Jason Nisler, to acquire 100 % of the outstanding securities of Bioflex and NTM (collectively, the “NTM Acquisition”).

On November 29, 2021, the Company entered into an Equity Purchase Agreement with BioFlex (“BioFlex EPA”), NTM and each of Ralph Meola and Jason Nisler, to acquire 100 % of the outstanding securities of BioFlex and NTM (collectively, the “NTM Acquisition”).

The transaction closed on December 16, 2021.

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Consideration Transferred

The NTM Acquisition was accounted for as a purchase of businesses under ASC 805, “Business Combinations”

and the Company engaged a third-party valuation firm to assist with the valuation of the business acquired.

Under the terms of the Equity Purchase Agreement, all outstanding shares of capital stock of BioFlex were acquired for consideration with a value totaling $ 31.6 million, which includes $ 3.0 million deposited into an escrow against which the Company may make claims for indemnification.

The NTM Acquisition was accounted for as a purchase of businesses under ASC 805, “Business Combinations” and the Company engaged a third-party valuation firm to assist with the valuation of the business acquired.

Under the terms of the BioFlex EPA, all outstanding shares of capital stock of BioFlex were acquired for consideration with a value totaling $ 31.6 million, which includes $ 3.0 million deposited into an escrow against which the Company may make claims for indemnification.

Under the acquisition method of accounting, the assets acquired and liabilities assumed of BioFlex were recorded as of the acquisition date, at their respective fair values, and consolidated with those of the Company.

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Avitide, Inc.

On September 16, 2021, the Company entered into an Agreement and Plan of Merger and Reorganization (“Avitide Merger Agreement”) with Avalon Merger Sub, Inc., a Delaware corporation and a wholly owned direct subsidiary of the Company, Avalon Merger Sub LLC, a Delaware limited liability company and a wholly owned direct subsidiary of the Company, Avitide, a Delaware corporation, and Shareholder Representative Services LLC, a Colorado limited liability company, solely in its capacity

as the representative, agent and attorney-in-fact of Avitide's securityholders to purchase Avitide.

The transaction closed on September 20, 2021, and on the terms set forth in the Avitide Merger Agreement.

Avitide, which is headquartered in Lebanon, New Hampshire, offers diverse libraries and leading technology in affinity ligand discovery and development resulting in best-in-class ligand discovery and development lead-times.

The acquisition gives the Company a new platform for affinity resin development, including C&GT, and advances and expands the Company’s proteins and chromatography franchises to address the unique purification needs of gene therapies and other emerging modalities.

The acquisition gives the

Company a new platform for affinity resin development, including C&GT, and advances and expands the Company’s proteins and chromatography franchises to address the unique purification needs of gene therapies and other emerging modalities.

Consideration Transferred

The Avitide Acquisition was accounted for as a purchase of a business under ASC 805, “Business Combinations”

and the Company engaged a third-party valuation firm to assist with the valuation of the business acquired.

The Avitide Acquisition was accounted for as a purchase of a business under ASC 805, “Business Combinations” and the Company engaged a third-party valuation firm to assist with the valuation of the business acquired.

Under the terms of the Avitide Merger Agreement, all outstanding shares of capital stock of Avitide were cancelled and converted into the right to receive merger consideration with a value totaling up to $ 275.0 million, which consisted of upfront payments in aggregate of $ 150.0 million ($ 149.4 million, net of cash acquired) and up to an additional $ 125.0 million (undiscounted) in contingent consideration earnout payments if certain performance targets are achieved.

Total consideration paid also included $ 0.8 million deposited into an escrow account against which the Company may make claims for indemnification.

The Avitide Acquisition was funded through payment of $ 75.0 million in cash, the issuance of 271,096 unregistered shares of the Company’s common stock totaling $ 83.0 million and contingent consideration with fair value of approximately $ 88.4 million.

Under the acquisition method of accounting, the assets acquired and liabilities assumed of Avitide were recorded as of the acquisition date, at their respective fair values, and consolidated with those of the Company.

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The transaction costs are included in operating expenses in the consolidated statements of comprehensive income for the periods ended December 31, 2022 and 2021.

During 2022 and 2021, due to the change in market inputs and a shift in revenue and volume projections, due to the expected timing of achievement over the three-year performance period, the Company recorded contingent consideration adjustments of ($ 28.7 ) million and $ 5.9 million to the Company’s consolidated statement of comprehensive income in 2022 and 2021, respectively.

See Note 3, "Fair Value Measurements" for additional information.

The preparation of the valuation required the use of significant assumptions and estimates.

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On June 22, 2021, the Company entered into a Stock Purchase Agreement with Polymem, a company organized under the laws of France, and Jean-Michel Espenan and Franc Saux, acting together jointly and severally as the representatives of the sellers pursuant to which Repligen acquired all of the outstanding common stock of Polymem for $ 47.0 million in cash.

The transaction closed on July 1, 2021 (the “Polymem Acquisition.”).

Polymem, which is headquartered in, Toulouse, France, is a manufacturer of hollow fiber (“HF”) membranes, membrane modules and systems for industrial and bioprocessing applications.

Polymem products will complement and expand the Company’s portfolio of HF systems and consumables.

The acquisition substantially increases Repligen’s membrane and module manufacturing capacity and establishes a world-class center of excellence in Europe to address the accelerating global demand for these innovative products.

Polymem products will complement and expand the Company’s portfolio of HF systems and consumables.

Consideration Transferred

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Non-competition agreements

2020 Acquisitions

ARTeSYN Biosolutions Holdings Ireland Limited

On October 27, 2020, the Company entered into an Equity and Asset Purchase Agreement with ARTeSYN, a company organized under the laws of Ireland, Third Creek Holdings, LLC, a Nevada limited liability company, Alphinity, LLC, a Nevada limited liability company (“Alphinity”, and together with Third Creek Holdings, LLC the “Sellers”), and Michael Gagne, solely in his capacity as the representative of the Sellers, pursuant to which the Company acquired (i) all of the outstanding equity securities of ARTeSYN and (ii) certain assets from Alphinity related to the business of ARTeSYN (collectively, the “ARTeSYN Acquisition”) for approximately $ 200 million, comprised of approximately $ 130 million in cash to the Sellers and approximately $ 70 million in Repligen common stock to Third Creek.

The transaction closed on December 3, 2020.

ARTeSYN is headquartered in Waterford, Ireland and conducts its operations in Ireland, the United States and Estonia.

Its suite of single-use solutions has been created with the goal of enabling “abundance in medicine”

by allowing 10x greater efficiency in biologics manufacturing.

The ARTeSYN team has created a number of solutions targeting the single-use space from single-use valves with fully disposable valve liners, XO ® skeletal supports, a hybrid small parts offering for de-bottlenecking traditional facilities, and fully automated SU process systems that have quickly become leading solutions in the bioprocessing industry.

In addition to its single-use solutions, ARTeSYN also engages in the manufacture of large-scale systems to be used for biologics manufacturing.

ARTeSYN has established downstream processing leadership with a suite of state of the art single-use systems for chromatography, filtration, continuous manufacturing and media/buffer prep workflows.

In addition, the Company has integrated unique flow path assemblies utilizing the Company’s silicone extrusion and molding technology, to deliver highly differentiated, low hold-up volume systems that minimize product loss during processing.

The ARTeSYN portfolio expands on the market success of the Company’s HF systems and complements its chromatography and tangential flow filtration ("TFF") product lines.

Acquisition related costs are not included as a component of consideration transferred but are expensed in the periods in which the costs are incurred.

The Company incurred $ 4.0 million in transaction and integration costs associated with the ARTeSYN Acquisition from the date of acquisition to December 31, 2020, and an additional $ 4.7 million of transaction and integration costs during 2021.

The transaction costs are included in operating expenses in the consolidated statements of comprehensive income for the period ended December 31, 2021.

Fair Value of Net Assets Acquired

The allocation of purchase price is based on the fair value of assets acquired and liabilities assumed as of the acquisition date, based on the preliminary valuation.

We have made appropriate adjustments to the purchase price allocation during the measurement period, which ended on December 3, 2021.

During 2021, the Company recorded net working capital adjustments of $ 0.1 million related to settlement of pre-acquisition liabilities, which offset goodwill in the table below.

The components and estimated allocation of the purchase price consists of the following amounts (amounts in thousands):

Cash and cash equivalents

Accounts receivable

Prepaid expenses and other current assets

Property and equipment

Operating lease right of use asset

Other noncurrent assets

Customer relationships

Developed technology

Trademark and tradename

Non-competition agreements

Accounts payable

Accrued liabilities

Deferred revenue

Deferred tax liabilities, net

Notes payable

Operating lease liability

Operating lease liability, long-term

Fair value of net assets acquired

Acquired Goodwill

The goodwill of $ 128.6 million represents future economic benefits expected to arise from synergies from combining operations and commercial organizations to increase market presence and the extension of existing customer relationships.

Substantially all of the goodwill recorded is expected to be deductible for income tax purposes.

Non-Metallic Solutions, Inc.

On October 15, 2020, the Company entered into a Stock Purchase Agreement with Non-Metallic Solutions, Inc.

("NMS"), a Massachusetts corporation, and each of William Malloneé

and Derek Masser, the legal and beneficial owners of NMS, to purchase NMS, which transaction subsequently closed on October 20, 2020 (the “NMS Acquisition”).

NMS, headquartered in Auburn, Massachusetts, is a manufacturer of fabricated plastics, custom containers, and related assemblies and components used in the manufacturing of biologic drugs.

The acquisition of NMS allows Repligen to expand its line of single-use systems and associated integrated flow path assemblies and streamline the supply chain for current products, providing more flexibility to scale and expand the Company's single-use and systems portfolios.

Fair Value of Net Assets Acquired

The allocation of purchase price is based on the fair value of assets acquired and liabilities assumed as of the acquisition date, based on the preliminary valuation.

We have made appropriate adjustments to the purchase price allocation during the measurement period, which ended on October 20, 2021.

The components and allocation of the purchase price consist of the following (amounts in thousands):

Cash and cash equivalents

Accounts receivable

Prepaid expenses and other current assets

Property and equipment

Operating lease right of use asset

Customer relationships

Developed technology

Trademark and tradename

Non-competition agreements

Deferred tax assets

Accounts payable

Accrued liabilities

Operating lease liability

Operating lease liability, long-term

Fair value of net assets acquired

Acquired Goodwill

The goodwill of $ 6.7 million represents future economic benefits expected to arise from anticipated synergies from the integration of NMS.

These synergies include certain cost savings, operating efficiencies and other strategic benefits projected to be achieved as a result of the NMS Acquisition.

Substantially all of the goodwill recorded is expected to be deductible for income tax purposes.

The Company has included the operating results of our 2021 acquisitions of Polymem, Avitide and NTM and the 2020 acquisitions of ARTeSYN, NMS and EMT in its consolidated statements of comprehensive income since their respective acquisition dates.

The Company does not consider these acquisitions to be material to its consolidated statements of comprehensive income and therefore has not included pro forma results.

Effective July 11, 2021, EMT was absorbed into the Company by way of “short-form”

merger pursuant to New York and Delaware law, which did not require a vote of the Company’s shareholders.

Restructuring Plan

In July 2023, the Board authorized the Company's management team to undertake restructuring activities to simplify and streamline our organization and strengthen the overall effectiveness of our operations.

In addition to the initial streamlining and re-balancing efforts contemplated in July, the Company is undertaking further restructuring activities (collectively, the “Restructuring Plan”) which include consolidating a portion of our manufacturing operations between certain U.S.

locations, discontinuing the sale of certain product SKUs, and evaluating the fair value of finished goods and raw materials, mostly secured during the 2020-2022 COVID-19 pandemic period (the “COVID-19 Period”) to meet increasing demand during a challenging supply chain environment in the industry.

The Company recorded pre-tax costs of $ 32.2 million in 2023 related to the Restructuring Plan and expects the Restructuring Plan to be completed by the end of the third quarter of 2024.

Of the $ 32.2 million in pre-tax costs in 2023, $ 27.6 million is non-cash, relating primarily to inventory adjustments to record inventory at net realizable value and accelerated depreciation on equipment related to the shutdown of manufacturing facilities and production lines, the remaining costs are cash expenses, primarily related to severance and employee-related costs.

The following table summarizes the charges related to restructuring activities by type of cost:

For the Year Ended December 31, 2023

Severance & Employee-Related Costs

Inventory Adjustments

Accelerated Depreciation

Facility and Other Exit Costs

(Amounts in thousands)

Cost of product revenue

Research and development

Selling, general and administrative

Severance and employee-related costs under the Restructuring Plan are associated with actual headcount reductions.

Costs incurred include cash severance and non-cash severance, including other termination benefits.

Severance and other termination benefit packages are based on established benefit arrangements or local statutory requirements and we recognized the contractual component of these benefits when payment was probable and could be reasonably estimated.

The inventory adjustments include the impact of the Company discontinuing the sale of certain product SKUs and the impact of having proactively secured materials during the COVID-19 Period to meet accelerated demand during a challenging supply chain environment in the industry.

Where demand has reduced, finished goods and raw materials, whose value exceeded the projected requirements to be used before reaching their expiration date, were written down to their realizable value.

The Restructuring Plan also includes the closing of manufacturing facilities and production lines, which included inventory that could not be repurposed.

Non-cash charges for accelerated depreciation were recognized on long-lived assets that were taken out of service before the end of their normal service due to the shutdown of manufacturing facilities and production lines, in which case depreciation estimates were revised to reflect the use of the assets over their shortened useful life.

The restructuring accrual is included in accrued liabilities on the condensed consolidated balance sheets as of December 31, 2023 and the balance has been paid as of that date.

Activity related to the Restructuring Plan for 2023 was as follows (amounts in thousands):

Restructuring Costs

Amounts Paid in 2023

Non-Cash Restructuring Items

Restructuring Liability

Severance & employee-related costs

Inventory adjustments

Accelerated depreciation

Facility exit and other exit costs

The Company is a lessee under leases of manufacturing facilities, office spaces, machinery, certain office equipment and vehicles.

A majority of the Company’s leases are operating leases with remaining lease terms between one month and 14 years.

Finance leases are immaterial to the Company’s consolidated financial statements.

A majority of the Company’s leases are operating leases with remaining lease terms between one month and 13 years.

Finance leases are immaterial to the Company’s consolidated financial statements.

The Company determines if an arrangement qualifies as a lease and what type of lease it is at inception.

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The Company also elected the practical expedients to combine lease and non-lease components and to exclude right of use assets and lease liabilities for leases with an initial term of 12 months or less from the balance sheet.

Some of the lease agreements the Company enters into include Company options to either extend and/or early terminate the lease, the costs of which are included in the Company’s operating lease liabilities to the extent that such options are reasonably certain of being exercised.

Leases with renewal options allow the Company to extend the lease term typically between 1 and 5 years per option, some of its leases have multiple options to extend.

When determining if a renewal option is reasonably certain of being exercised, the Company considers several economic factors, including but not limited to, the significance of leasehold improvements incurred on the property, whether the asset is difficult to replace, underlying contractual obligations, or specific characteristics unique to that particular lease that would make it reasonably certain that the Company would exercise such options.

As of December 31, 2022 and 2021, operating lease right of use assets wer e $ 125.0 million and $ 101.6 million, respectively and operating lease liabilities were $ 138.3 million and $ 110.8 million, respectively.

The Company signed the Sixth Amendment of Lease for our headquarters in Waltham, Massachusetts in September 2021 to expand the facility by 74,108 square feet.

The facility expanded by 21,244 square feet immediately.

The remaining 52,864 square feet commenced in June 2022.

As a result of this and the expansion of facilities in Bridgewater, New Jersey and Clifton Park, New York, the operating right of use asset and operating lease liability balances increased by a total of $ 23.5 million in 2022, net of the normal amortization of existing leases.

The maturities of the Company’s operating lease liabilities as of December 31, 2022 are as follows (amounts in thousands):

As of December 31, 2023 and 2022, operating lease right of use assets wer e $ 115.5 m illion and $ 125.0 million, respectively and operating lease liabilities were $ 132.2 million and $ 138.3 million, respectively.

The addition of FlexBiosys and Metenova in 2023 added 43,833 square feet to our leased properties and as a result of that and the expansion in Toulouse, France, the operating right of use asset balance increased $ 4.0 million in 2023, as compared to 2022.

However, the consolidated right of use assets balance decreased due to the normal amortization of existing leases during 2023.

The maturities of the Company’s operating lease liabilities as of December 31, 2023 are as follows (amounts in thousands):

As of December 31, 2023

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Total operating lease liabilities

Total operating lease liabilities included on the Company’s consolidated balance sheet are as follows (amounts in thousands):

(1) The future minimum lease payments include obligations for leases not yet commenced of $ 26.8 million for manufacturing, office and warehouse facilities.

These leases have terms of between 5 and 10 years and commence during the first quarter of 2024.

Total operating lease liabilities included on the Company’s consolidated balance sheets are as follows (amounts in thousands):

Operating lease liability

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Lease expense for these leases is recognized on a straight-line basis over the lease term, with variable lease payments recognized in the period those payments are incurred.

For the year ended December 31, 2022 and 2021, total lease cost is comprised of the following:

For the years ended December 31, 2023, 2022 and 2021, total lease cost is comprised of the following:

For the Years Ended December 31,

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Most of the leases do not provide implicit interest rates and therefore the Company determines the discount rate based on its incremental borrowing rate.

The incremental borrowing rate for the Company’s leases is determined based on lease term and currency in which the lease payments are made.

The weighted average remaining lease term and the weighted average discount rate used to measure the Company’s operating lease liabilities as of December 31, 2022, were:

The incremental borrowing rate for the Company’s leases is determined based on lease term and currency in which the lease payments are made.

The weighted average remaining lease term and the weighted average discount rate used to measure the Company’s operating lease liabilities as of December 31, 2023, were:

Weighted average remaining lease term (years)

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Under ASC 606, “Revenue from Contracts with Customers,”

revenue is recognized when, or as, obligations under the terms of a contract are satisfied, which occurs when control of the promised products or services is transferred to customers.

Under ASC 606, “Revenue from Contracts with Customers,” revenue is recognized when, or as, obligations under the terms of a contract are satisfied, which occurs when control of the promised products or services is transferred to customers.

Disaggregation of Revenue

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When disaggregating revenue, the Company considered all of the economic factors that may affect its revenues.

Because all of its revenues are from bioprocessing customers, there are no differences in the nature, timing and uncertainty of the Company’s revenues and cash flows from any of its product lines.

However, given that the Company’s revenues are generated in different geographic regions, factors such as regulatory and geopolitical factors within those regions could impact the nature, timing and uncertainty of the Company’s revenues and cash flows.

In addition, a significant portion of the Company’s revenues are generated from a few customers;

therefore, economic factors specific to these customers could impact the nature, timing and uncertainty of the Company’s revenues and cash flows.

Disaggregated revenue from contracts with customers by geographic region can be found in Note 2, “Summary of Significant Accounting Policies –

Segment Reporting,”

There was no revenue from customers that represented 10 % or more of the Company's total revenue for the year ended December 31, 2022.

Because its revenues are from bioprocessing customers, there are no differences in the nature, timing and uncertainty of the Company’s revenues and cash flows from any of its product lines.

Disaggregated revenue from contracts with customers by geographic region can be found in Note 2, “Summary of Significant Accounting Policies – Segment Reporting,” above.

There was no revenue from customers that represented 10 % or more of the Company's total revenue for the year ended December 31, 2023 and 2022.

Revenue from Pfizer Inc.

was $ 68.3 million, or 10 %, of the Company's total revenue for the year ended December 31, 2021 and MilliporeSigma accounted for $ 39.5 million, or 11 % of total revenues in the year ended December 31, 2020.

was $ 68.3 million, or 10 %, of the Company's total revenue for the year ended December 31, 2021.

Filtration Products

The Company’s filtration products generate revenue through the sale of KrosFlo hollow fiber ("HF") TFF systems, TangenX ® flat sheet ("FS") cassettes, Spectrum ® HF filters, membranes and modules, XCell ATF systems and related consumables.

Supporting our systems, we also sell ProConnex ® Flow Path assemblies and custom silicone-based, single-use flow path assemblies and components from Polymem, BioFlex, NMS and ARTeSYN, four acquisitions completed in 2021 and 2020.

The Company’s KrosFlo systems are used in the filtration, isolation, purification and concentration of biologics and diagnostic products.

The Company’s filtration products generate revenue through the sale of KrosFlo and ARTeSYN tangential flow filtration (“TFF”) systems, TangenX ® flat sheet (“FS") cassettes, Spectrum ® HF filters, membranes and modules, XCell ATF systems and related consumables.

Supporting our systems, we also sell ProConnex ® Flow Path assemblies and custom silicone-based, single-use flow path assemblies and components from Metenova, FlexBiosys, BioFlex, Polymem, ARTeSYN Biosolutions Holdings Ireland Limited, NMS and EMT, seven acquisitions completed since 2020.

The Company’s KrosFlo and ARTeSYN systems are used in the filtration, isolation, purification and concentration of biologics and diagnostic products.

TFF is a rapid and efficient method for separation and purification of biomolecules that is widely used in laboratory, process development and process scale applications in biopharmaceutical manufacturing.

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Training and installation services do not significantly modify or customize these systems and therefore represent a distinct performance obligation.

The Company’s TangenX FS cassettes (SIUS, SIUS Gamma ® and PRO) are not highly interdependent on one another and are therefore considered distinct products that represent separate performance obligations.

Product revenue from the sale of TangenX FS cassettes is generally recognized at a point in time upon transfer of control of the customer.

The Company’s other filtration product offerings are not highly interdependent of one another and are therefore considered distinct products that represent separate performance obligations.

Revenue on these products is generally recognized at a point in time upon transfer of control to the customer.

The Company invoices the customer for the installation and training services in an amount that directly corresponds with the value to the customer of the Company’s performance to date;

therefore, revenue recognized is based on the amount billable to the customer in accordance with the practical expedient under ASC 606-10-55-18.

The Company also markets the XCell ATF system, a technologically advanced filtration device used in upstream processes to continuously remove cellular metabolic waste products during the course of a fermentation run, freeing healthy cells to continue producing the biologic drug of interest.

XCell ATF systems typically include a filtration system and consumables (i.e., tubing sets, metal stands) as well as training and installation services at the request of the customer.

The filtration system and consumables are considered distinct products and therefore represent separate performance obligations.

First time purchasers of the systems typically purchase a controller that is shipped with the tubing set(s) and metal stand(s).

The controller is not considered distinct as it is a proprietary product that is highly interdependent with the filtration system;

therefore, the controller is combined with the filtration system and accounted for as a single performance obligation.

The training and installation services do not significantly modify or customize the XCell ATF system and therefore represent a distinct performance obligation.

XCell ATF system product revenue related to the filtration system (including the controller if applicable) and consumables is generally recognized at a point in time upon transfer of control to the customer.

XCell ATF system service revenue related to training and installation services is generally recognized over time, as the customer simultaneously receives and consumes the benefits as the Company performs.

The Company invoices the customer for the installation and training services in an amount that directly corresponds with the value to the customer of the Company’s performance to date;

The Company invoices the customer for the installation and training services in an

amount that directly corresponds with the value to the customer of the Company’s performance to date;

therefore, revenue recognized is based on the amount billable to the customer in accordance with the practical expedient under ASC 606-10-55-18.

The Company also markets XCell ATF controllers, which are technologically advanced filtration devices used in upstream processes to continuously remove cellular metabolic waste products during the course of a fermentation run, freeing healthy cells to continue producing the biologic drug of interest.

XCell ATF controllers are typically sold with consumables (i.e., tubing sets, metal stands) as well as training and installation services at the request of the customer.

The controllers and consumables are considered distinct products and therefore represent separate performance obligations.

First time purchasers of the controllers typically purchase a controller that is shipped with the tubing set(s) and metal stand(s).

The training and installation services do not significantly modify or customize the XCell ATF controllers and therefore represent a distinct performance obligation.

XCell ATF product revenue related to controllers and consumables is generally recognized at a point in time upon transfer of control to the customer.

Chromatography Products

The Company’s chromatography products include a number of products used in the downstream purification and quality control of biological drugs.

The majority of chromatography revenue relates to the OPUS pre-packed chromatography column line.

The Company’s chromatography products include a number of products used in the downstream purification and quality control of biological drugs.

The majority of chromatography revenue relates to the OPUS pre-packed chromatography column product line.

OPUS columns are designed to be disposable following a production campaign.

Each OPUS column is delivered pre-packaged with the customer’s choice of chromatography resin, which is either provided by the Company for the customer or customer supplied.

In either scenario, the OPUS column and resin are not interdependent of one another and are therefore considered distinct products that represent separate performance obligations.

Chromatography product revenue is generally recognized at a point in time upon transfer of control to the customer.

Each OPUS column is delivered pre-packaged with the customer’s choice of chromatography resin, which is either provided by the Company for the customer or is customer supplied.

Chromatography product revenue is generally recognized at a point in time upon transfer of control to the customer and represents a single performance obligation.

Process Analytics Products

The process analytics franchise generates revenue primarily through the sale of the SoloVPE, FlowVPE and FlowVPX slope spectroscopy systems, consumables and service.

These products complement and support the Company’s existing filtration, chromatography and proteins franchises as they allow end-users to make in-line protein concentration measurements in filtration, chromatography and fill-finish applications, designed to allow for real-time process monitoring.

The process analytics franchise generates revenue primarily through the sale of the SoloVPE and FlowVPX slope spectroscopy systems, consumables and service.

Process analytics product revenue is generally recognized at a point in time upon transfer of control to the customer.

Protein Products

The Company’s protein franchise generates revenue through the sale of Protein A affinity ligands and growth factors.

The Company’s protein franchise generates revenue primarily through the sale of Protein A affinity ligands and growth factors.

Protein A ligands are an essential component of Protein A chromatography resins (media) used in the purification of virtually all mAb-based drugs on the market or in development.

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Protein product revenue is generally recognized at a point in time upon transfer of control to the customer.

On September 20, 2021, the Company completed the Avitide Acquisition and added its diverse libraries and leading technology in affinity ligand discovery and development to its proteins franchise.

In 2021, the Company completed the Avitide Acquisition and added its diverse libraries and leading technology in affinity ligand discovery and development to its proteins franchise.

Other Products

The Company’s other products include operating room products sold to hospitals.

Other product revenue is generally recognized at a point in time upon transfer of control to the customer.

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Remaining performance obligations represent the transaction price of contracts for which work has not been performed or has been partially performed.

The Company’s future performance obligations relate primarily to the installation and training of certain of its systems sold to customers.

The Company’s future performance obligations relate primarily to the installation and training of

certain of its systems sold to customers.

These performance obligations are completed within one year of receipt of a purchase order from its customers.

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The beginning deferred revenue balance

The timing of revenue recognition, billings and cash collections results in the accounts receivable and deferred revenue balances on the Company’s consolidated balance sheets.

A contract asset is created when the Company satisfies a performance obligation by transferring a promised good to the customer.

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Costs to Obtain or Fulfill a Customer Contract

The Company’s sales commission structure is based on achieving revenue targets.

The commissions are driven by revenue derived from customer purchase orders which are short term in nature.

Applying the practical expedient in paragraph 340-40-25-4, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less.

These costs are included in selling, general, and administrative expenses in our consolidated statement of comprehensive income.

These costs are included in selling, general, and administrative expenses in our consolidated statements of comprehensive income.

When shipping and handling costs are incurred after a customer obtains control of the products, the Company accounts for these as costs to fulfill the promise and not as a separate performance obligation.

Credit Losses

Effective January 1, 2020, the Company adopted ASU 2016-13, “Financial Instruments –

Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments,”

prospectively.

ASU 2016-13 replaces the incurred loss impairment model with an expected credit loss impairment model for financial instruments, including trade receivables.

The guidance requires entities to consider forward-looking information to estimate expected credit losses, resulting in earlier recognition of losses for receivables that are current or not yet due.

Upon adoption, changes in the allowance were not material for the transition period starting January 1, 2020 through December 31, 2020.

The Company is exposed to credit losses primarily through sales of products and services.

The Company’s expected loss allowance methodology for accounts receivable is developed using historical collection experience, current and future economic and market conditions and a review of the current status of customers' trade accounts receivable.

Customers are pooled based on sharing specific risk factors, including geographic location.

Due to the short-term nature of such receivables, the estimated accounts receivable that may not be collected is based on aging of the accounts receivable balances.

Customers are assessed for credit worthiness upfront through a credit review, which includes assessment based on the Company’s analysis of their financial statements when a credit rating is not available.

The Company evaluates contract terms and conditions, country and political risk, and may require prepayment to mitigate risk of loss.

The Company evaluates contract terms and conditions,

country and political risk, and may require prepayment to mitigate risk of loss.

Specific allowance amounts are established to record the appropriate provision for customers that have a higher probability of default.

The Company monitors changes to the receivables balance on a timely basis, and balances are written off as they are determined to be uncollectable after all collection efforts have been exhausted.

The Company monitors changes to the receivables balance on a timely basis, and balances are written off as they are determined to be uncollectible after all collection efforts have been exhausted.

Estimates of potential credit losses are used to determine the allowance.

It is based on assessment of anticipated payment and all other historical, current and future information that is reasonably available.

The accounts receivable balance on the Company’s consolidated balance sheet as of December 31, 2022 was $ 116.2 million, net o f $ 1.4 million of allowances.

The following table provides a roll-forward of the allowance for credit losses in 2022 that is deducted from the amortized cost basis of accounts receivable to present the net amount expected to be collected (amounts in thousands):

The accounts receivable balance on the Company’s consolidated balance sheets as of December 31, 2023 was $ 124.2 million, net o f $ 2.1 million of allowances.

The following table provides a roll-forward of the allowance for credit losses in 2023 and 2022 that is deducted from the amortized cost basis of accounts receivable to present the net amount expected to be collected (amounts in thousands):

For the Years Ended December 31,

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Goodwill represents the difference between the purchase price and the estimated fair value of identifiable assets acquired and liabilities assumed.

Goodwill acquired in a business combination and determined to have an indefinite useful life is not amortized,

but instead is tested for impairment at least annually in accordance with ASC 350.

Goodwill acquired in a business combination and determined to have an indefinite useful life is not amortized, but instead is tested for impairment at least annually in accordance with ASC 350.

The following table represents the changes in the carrying value of goodwill for the years ended December 31, 2023 and 2022 (amounts in thousands):

Balance as of December 31, 2021

Measurement period adjustment - NMS

Measurement period adjustment - ARTeSYN

Acquisition of Polymem

Acquisition of Avitide

Acquisition of NTM

Cumulative translation adjustment

Balance as of December 31, 2021

Measurement period adjustment - BioFlex

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Balance as of December 31, 2022

Acquisition of FlexBiosys, Inc.

Acquisition of Metenova Holding AB

Cumulative translation adjustment

Balance as of December 31, 2023

During each of the fourth quarters of 2023, 2022 and 2021, the Company completed its annual impairment assessments and concluded that goodwill was not impaired in any of those years.

Intangible Assets

Intangible assets with a definitive life are amortized over their useful lives using the straight-line method, and the amortization expense is recorded within cost of product revenue and selling, general and administrative expense in the Company’s consolidated statements of comprehensive income.

If impairment indicators are present, the Company determines whether the underlying intangible asset is recoverable through estimated future undiscounted cash flows.

If the estimate of an intangible asset’s remaining useful life is changed, the remaining carrying amount of the intangible asset is amortized prospectively over the revised remaining useful life.

If the estimate of an intangible asset’s remaining useful life is changed, the remaining carrying amount of

the intangible asset is amortized prospectively over the revised remaining useful life.

The Company continues to believe that its definite-lived intangible assets are recoverable at December 31, 2023.

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Total intangible assets

(1) Includes an upfront payment paid to DRS Daylight Solutions, Inc.

("Daylight") in September 2022 to exclusively license and commercialization rights to use certain technology and intellectual property which Daylight owns.

The expected useful life of this technology is 15 years, which is the term of the exclusive License Agreement ("Daylight Agreement") and the period the Company expects to be able to utilize the license and which the technology will contribute directly to cash flows.

See Note 12, "Commitments and Contingencies" for more information on this transaction.

Intangible assets consisted of the following at December 31, 2022:

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(Amounts in thousands)

Components of the income tax provision (benefit):

Jurisdictional components of the income tax provision (benefit):

Components of the income tax provision:

Jurisdictional components of the income tax provision:

At December 31, 2023 , the Company had federal net operating loss carryforwards of $ 31.1 million, state net operating loss carryforwards of $ 1.5 million, and foreign net operating loss carryforwards of $ 4.9 million.

Federal net operating loss carryforwards of $ 7.3 million will expire at various dates through 2037 .

The state net operating loss carryforwards will expire at various dates through 2041, while the foreign net operating loss carryforwards do not expire.

The other $ 35.6 million of federal net operating loss carryforwards have unlimited carryforward periods.

At December 31, 2022 , the Company had state business tax credits carryforwards of $ 3.8 million available to reduce future domestic income taxes.

The state net operating loss carryforwards will expire at various dates through 2043 , while the federal and foreign net operating loss carryforwards have unlimited carryforward periods and do not expire.

At December 31, 2023 , the Company had federal and state business tax credits carryforwards of $ 5.0 million available to reduce future federal and state income taxes.

The business tax credit carryforwards will expire at various dates through 2043.

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Operating lease right of use assets

Conversion option on convertible notes

Debt discount

Total deferred tax liabilities

Total net deferred tax liabilities

The net change in the total valuation allowance for the year ended December 31, 2022 and 2021 was a decrease of approximately $ 0.7 million and a decrease of $ 9,000 , respectively.

The net change in the total valuation allowance for the year ended December 31, 2023 and 2022 was an increase of approximately $ 1,000 and a decrease of approximately $ 0.7 million, respectively.

The reconciliation of the federal statutory rate to the effective income tax rate for the years ended December 31, 2023, 2022 and 2021 is as follows:

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Difference between U.S.

State income and franchise tax

and foreign tax

State income taxes

Business tax credits

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Contingent consideration

Change in U.S.

and foreign tax rates

Loss on extinguishment of debt

Debt discount

Foreign exchange loss

Uncertain tax provisions

Change in valuation allowance

Return to provision adjustments

Income tax provision

The Company’s tax returns are subject to examination by federal, state and foreign tax authorities.

The Company’s two major tax jurisdictions are subject to examination for the following periods:

The Company’s tax returns are subject to examination by federal, state and foreign tax authorities.

The Company’s two major tax jurisdictions are subject to examination for the following periods:

Fiscal Years Subject to Examination

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of tax positions taken in the current period

Gross amounts of increases and (decreases) in unrecognized tax benefits as a result

Gross amounts of increases in unrecognized tax benefits as a result

of tax positions taken in the prior period

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The Company classifies interest and penalties related to income taxes as components of its income tax provision.

In 2022, a net expense of approximately $ 24,000 was recorded to the income tax provision related to interest and penalties while in 2021 and 2020, net (benefit)/expenses of approximately ($ 29,000 ) and $ 17,000 , respectively, were recorded.

In 2023, a net expense of approximately $ 15,000 , was recorded to the income tax provision related to interest and penalties while in 2022, a net expense of approximately $ 24,000 was recorded.

The amount of interest and penalties recorded in the accompanying consolidated balance sheets was approximately $ 67,000 and $ 52,000 as of December 31, 2023 and 2022 , respectively.

The Company does not anticipate the amount of unrecognized tax benefits to change over the next twelve months.

On August 16, 2022, the United States enacted the Inflation Reduction Act of 2022 ("IRA"), which, among other things, implements a 15 % alternative minimum tax on global adjusted financial statement income of certain large corporations, a 1 % excise tax on net stock repurchases and several tax incentives to promote clean energy and will become effective beginning in

The Company evaluated the provisions of the IRA and no provision had, or will have a material effect on our consolidated financial position or results of operations as of December 31, 2022.

In the next twelve months, it is reasonably possible the Company will reduce its gross unrecognized tax benefits, excluding interest by up to $ 1.1 million due to expiring statutes of limitations.

In 2021, the Organization of Economic Co-operation and Development announced an Inclusive Framework on Base Erosion and Profit Sharing with the goal of achieving consensus around substantial changes to international tax policies, including the implementation of a minimum global effective tax rate of 15 %.

We continue to evaluate the impacts of enacted legislation and

pending legislation in the tax jurisdictions in which we operate.

While various countries have implemented the legislation as of January 1, 2024, we do not expect a resulting material change to our income tax provision for the 2024 fiscal year.

As of December 31, 2023 , the Company has accumulated undistributed earnings generated by its foreign subsidiaries of approximately $ 212.4 million.

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At December 31, 2023 , the Company has not provided for taxes on outside basis differences of its foreign subsidiaries as it is not practicable and the Company has the ability and intent to indefinitely reinvest the undistributed earnings of its foreign subsidiaries, and there are no needs for such earnings in the United States that would contradict its plan to indefinitely reinvest.

Stockholders’

Public Offerings of Common Stock

On December 8, 2020, the Company completed a public offering in which 1,725,000 shares of its common stock, including the underwriters’

exercise in full of an option to purchase an additional 225,000 shares, were sold to the public at a price of $ 181.00 per share (the “December Stock Offering”).

The net proceeds of the December Stock Offering, after deducting underwriting discounts and commissions and other estimated offering expenses payable by the Company, were approximately $ 297.8 million.

On July 19, 2019, the Company completed a public offering in which 1,587,000 shares of its common stock, including the underwriters’

exercise in full of an option to purchase an additional 207,000 shares, were sold to the public at a price of $ 87.00 per share (the “July Stock Offering”).

The net proceeds of the July Stock Offering, after deducting underwriting discounts and commissions and other estimated offering expenses payable by the Company, were approximately $ 131.1 million.

On May 3, 2019, the Company completed a public offering in which 3,144,531 shares of its common stock, including the underwriters’

full exercise of an option to purchase up to an additional 410,156 shares, were sold to the public at a price of $ 64.00 per share (the "May Stock Offering").

The total proceeds received by the Company from the May Stock Offering, net of underwriting discounts and commissions and other estimated offering expenses payable by the Company, totaled approximately $ 189.6 million.

Stockholders’ Equity

Share Repurchases

In December 2023, the Board authorized and approved a stock repurchase of up to $ 25.0 million of the Company's common stock concurrent with the issuance of $ 600.0 million aggregate principal amount of its 2023 Notes.

See Note 14, “ Convertible Senior Notes,” for more information on the issuance.

The Company used $ 14.4 million of the proceeds from the issuance of the 2023 Notes to repurchase 92,090 shares at a price of $ 156.22 , including transaction costs, to offset the impact of dilution from the issuance of 2023 Notes and equity compensation programs as well as to reduce its outstanding share count.

The Company has elected to retire the shares repurchased to date.

Retired shares become part of the pool of authorized but unissued shares.

The purchase price of the retired shares in excess of par value, including transaction costs, is recorded as a decrease to additional paid-in capital in the Company's consolidated balance sheets as of December 31, 2023.

Stock Option and Incentive Plans

At the Company’s 2018 Annual Meeting of Stockholders held on May 16, 2018, the Company’s shareholders approved the 2018 Stock Option and Incentive Plan (the “2018 Plan”).

Under the 2018 Plan the number of shares of the Company’s common stock that are reserved and available for issuance shall be 2,778,000 plus the number of shares of common stock available for issuance under the Company’s Amended and Restated 2012 Stock Option and Incentive Plan (the “2012 Plan”).

The shares of common stock underlying any awards under the 2018 Plan, 2012 Plan and the Second Amended and Restated 2001 Repligen Corporation Stock Plan (the “2001 Plan,”

and together with the 2018 Plan and 2012 Plan, the “Plans”) that are forfeited, canceled or otherwise terminated (other than by exercise) shall be added back to the shares of stock available for issuance under the 2018 Plan.

At the Company’s 2018 Annual Meeting of Stockholders held on May 16, 2018, the Company’s shareholders approved the 2018 Stock Option and Incentive Plan (the “2018 Plan”).

The shares of common stock underlying any awards under the 2018 Plan and 2012 Plan that are forfeited, canceled or otherwise terminated (other than by exercise) shall be added back to the shares of stock available for issuance under the 2018 Plan.

At December 31, 2023, 1,671,408 shares were available for future grants under the 2018 Plan.

Stock Issued for Earnout Payment

In May 2023, the Company issued 42,621 shares of its common stock to former securityholders of Avitide to satisfy the contingent consideration obligation established under the Agreement and Plan of Merger and Reorganization (the “Avitide Agreement”) which the Company entered into as part of the Avitide Acquisition.

See Note 4, “ Acquisitions” above for additional information on the Avitide Acquisition and the contingent consideration.

The shares represent 50 % of the earnout consideration earned in the First Earnout Year (as defined in the Avitide Agreement).

Stock-Based Compensation

The Company recorded stock-based compensation expense of $ 25.6 million, $ 27.3 million and $ 27.5 million for the years ended December 31, 2023, 2022 and 2021 , respectively, for share-based awards granted under the Plans.

The following table presents stock-based compensation expense in the Company’s consolidated statements of comprehensive income:

For the Years Ended December 31,

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Total stock-based compensation

The 2018 Plan allows for the granting of incentive and nonqualified options to purchase shares of common stock, restricted stock and other equity awards.

Except for the grant to the Company’s Chief Executive Officer (“CEO”) in 2018 mentioned below, employee grants under the Plans generally vest over a three - to five-year period, with 20 %- 33 % vesting on the first anniversary of the date of grant and the remainder vesting in equal yearly installments thereafter.

Nonqualified options issued to non-employee directors under the Plans generally vest over one year.

In the first quarter of 2018, to create a longer-term retention incentive, the Company’s Compensation Committee granted long-term incentive compensation awards to its CEO which consisted of both stock options and restricted stock units that are subject to time-based vesting over nine years .

Options granted under the Plans have a maximum term of ten years from the date of grant and generally, the exercise price of the stock options equals the fair market value of the Company’s common stock on the date of grant.

At December 31, 2022, options to purchase 609,965 shares and 531,034 stock units were outstanding under the Plans.

Stock Options

The Company uses the Black-Scholes option pricing model to calculate the fair value of stock option awards on the grant date, and measures stock-based compensation costs of stock options at the grant date based on the estimated fair value of the award.

The Company recognizes expense on awards with service-based vesting over the employee’s requisite service period on a straight-line basis.

The Company recognizes stock-based compensation expense for options that are ultimately expected to vest, and accordingly, such compensation expense has been adjusted for estimated forfeitures.

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(1) Represents the number of vested options as of December 31, 2023 plus the number of unvested options expected to vest as of December 31, 2023, based on the unvested outstanding options at December 31, 2023 adjusted for estimated forfeiture rates of 8 % for awards granted to non-executive level employees and 3 % for awards granted to executive level employees.

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the closing price of the common stock on December 31, 2022, the last business day of 2022, of $ 169.31 per share and the exercise price of

each in-the-money option) that would have been received by the option holders had all option holders exercised their options on December 31, 2022.

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the closing price of the common stock on December 29, 2023, the last business day of 2023, of $ 179.80 per share and the exercise price of each in-the-money option) that would have been received by the option holders had all option holders exercised their options on

December 31, 2023.

The aggregate intrinsic value of stock options exercised during the years ended December 31, 2023, 2022 and 2021 was $ 5.8 million, $ 14.1 million and $ 20.3 million, respectively.

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The total fair value of stock options that vested during the years ended December 31, 2023, 2022 and 2021 was $ 4.7 million, $ 3.1 million and $ 3.0 million, respectively.

The fair value of stock units is calculated using the closing price of the Company’s common stock on the date of grant.

The Company recognizes expense on awards with service-based vesting over the employee's requisite service period on a straight-line basis.

Prior to 2020, the Company issued performance stock units to certain employees which are tied to the achievement of certain Company financial goal metrics and the passage of time.

Since 2020, the Company has implemented formal programs that issue performance stock units to certain employees set to vest upon the achievement of individual goals and financial goals of the Company, as well as the passage of time.

The Company recognizes expense on performance-based awards over the vesting period based on the probability that the performance metrics will be achieved.

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License Agreement

On September 19, 2022, the Company entered into the Daylight Agreement with Daylight, giving the Company exclusive license and commercialization rights to use certain technology and intellectual property subject to conditions set forth in the Daylight Agreement.

On September 19, 2022, the Company entered into a 15-year exclusive License Agreement (the “Daylight Agreement”) with DRS Daylight Solutions, Inc.

(“Daylight”), giving the Company exclusive license and commercialization rights to use certain technology and intellectual property subject to conditions set forth in the Daylight Agreement.

The Company agreed to pay Daylight (i) an initial, one-time, non-refundable, non-creditable upfront cash payment and (ii) certain quarterly royalty payments.

compact, intelligent spectrometer that uses the power of quantum cascade lasers ("QCLs") to analyze and identify chemicals.

Under the Daylight Agreement, the Company assumes responsibility for the commercialization and sale of Culpeo, in addition to the ability to incorporate the intellectual property into optimized products over the term of the Daylight Agreement.

Pursuant to the Daylight Agreement, the Company obtains the exclusive, non-transferrable, right and license to use specifically in the field of bioprocessing, the Daylight intellectual property called Culpeo ® QCL-IR Liquid Analyzer (“Culpeo”), which is a compact, intelligent spectrometer that uses the power of quantum cascade lasers to analyze and identify chemicals.

Under the Daylight Agreement, the Company assumes responsibility for the commercialization and sale of Culpeo, in addition to the ability

to incorporate the intellectual property into optimized products over the term of the Daylight Agreement.

Daylight will continue to sell the products in the specified fields of Aerospace and Defense.

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Generally, the license agreements require the Company to pay annual maintenance fees and royalties on product sales once a product has been established using the technologies.

Research and development expenses associated with license agreements were immaterial amounts for the years ended December 31, 2022, 2021 and 2020.

In June 2018, the Company secured an agreement with Navigo Proteins GmbH (“Navigo”) for the exclusive co-development of multiple affinity ligands for which Repligen holds commercialization rights.

The Company is manufacturing and supplying the first of these ligands, NGL-Impact ® , exclusively to Purolite, an Ecolab Inc.

company ("Purolite"), who is pairing the Company’s high-performance ligand with Purolite’s agarose jetting base bead technology used in their Jetted A50 Protein A resin product.

The Company also signed a long-term supply agreement with Purolite for NGL-Impact and other potential additional affinity ligands that may advance from the Company’s Navigo collaboration.

R&D expenses associated with license agreements were immaterial amounts for the years ended December 31, 2023, 2022 and 2021.

The Company is manufacturing and supplying the first of these ligands, NGL-Impact ® , exclusively to Purolite, who is pairing the Company’s high-performance ligand with Purolite’s agarose jetting base bead technology used in their Jetted A50 Protein A resin product.

The Company also signed a long-term supply agreement with Purolite for NGL-Impact and other potential additional affinity ligands that may advance from the Company’s Navigo collaboration.

In September 2020, the Company and Navigo successfully completed co-development of an affinity ligand targeting the SARS-CoV-2 spike protein, to be utilized in the purification of vaccines for the COVID-19 pandemic, including emerging variants of the SARS-CoV-2 coronavirus.

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The Company is manufacturing and supplying this ligand, NGL-Impact ® HipH, to Purolite.

The Navigo and Purolite agreements are supportive of the Company’s strategy to secure and reinforce the Company’s proteins business.

The Company made payments to Navigo of $ 2.6 million, $ 2.3 million and $ 0.9 million in the years ended December 31, 2022, 2021 and 2020, respectively, in connection with this program, which are recorded to research and development expenses in the Company’s consolidated statements of comprehensive income.

The Navigo and Purolite agreements are supportive of the Company’s strategy to secure and reinforce the Company’s proteins business.

The Company made royalty payments to Navigo of $ 3.8 million, $ 2.6 million and $ 2.3 million in the years ended December 31, 2023, 2022 and 2021, respectively, in connection with this program, which are recorded to research and development expenses in the Company’s consolidated statements of comprehensive income.

Purchase Orders, Supply Agreements and Other Contractual Obligations

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Litigation can be expensive and disruptive to normal business operations.

Moreover, the results of complex legal proceedings are difficult to predict, and the Company’s view of these matters may change in the future as the litigation and events related thereto unfold.

The Company expenses legal fees as incurred.

The Company records a provision for contingent losses when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

An unfavorable outcome to any legal matter, if material, could have an adverse effect on the Company’s operations or its financial results.

Convertible Senior Notes

The carrying value of the Company’s convertible senior notes is as follows:

(Amounts in thousands)

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Principal amount

Unamortized debt issuance costs

Carrying amount - Convertible Senior Notes due 2024, net

1.00% Convertible Senior Notes due 2028:

Principal amount

Unamortized debt discount

Unamortized debt issuance costs

Net carrying amount

Carrying amount - Convertible Senior Notes due 2028, net

1.00% Convertible Senior Notes due 2028

On July 19, 2019, the Company issued $ 287.5 million aggregate principal amount of the 2019 Notes, which includes the underwriters’

exercise in full of an option to purchase an additional $ 37.5 million aggregate principal amount of 2019 Notes (the “Notes Offering”).

The net proceeds of the Notes Offering, after deducting underwriting discounts and commissions and other related offering expenses payable by the Company, were approximately $ 278.5 million.

On December 14, 2023, the Company issued $ 600.0 million aggregate principal amount of its 2023 Notes in the Exchange and Subscription Agreements with a limited number of holders of its outstanding 2019 Notes and certain other qualified institutional buyers pursuant to Rule 144A under the Securities Act.

Pursuant to the Exchange and Subscription Agreements, the Company exchanged $ 217.7 million of its 2019 Notes, which were cancelled upon exchange, for $ 309.9 million aggregate principal amount of the 2023 Notes (the “Exchange Transaction”) and issued $ 290.1 million aggregate principal amount of the 2023 Notes in a private placement to accredited institutional buyers (the “Subscription Transactions”) for $ 290.1 million in cash.

The Company evaluated the Exchange Transaction and determined approximately $ 29.6 million of the $ 217.7 million principal of the exchanged 2019 Notes should be accounted for as extinguishments of debt and approximately $ 188.1 million should be accounted for as modification of debt.

As a result, we recognized a $ 12.7 million loss on extinguishment of debt in our consolidated statements of comprehensive income for the year ended December 31, 2023, inclusive of $ 0.1 million of unamortized debt issuance costs.

Under modification accounting, the carrying amount of the modified 2019 Notes was reduced by $ 2.8 million, with a corresponding increase to additional paid-in capital, to account for the increase in the fair value of the embedded conversion option, representing a debt discount of the modified 2019 Notes.

The aggregate debt discount of $ 82.1 million, comprised of $ 79.3 million increase in principal of the modified 2019 Notes and a $ 2.8 million increase in the fair value of the embedded conversion option, is as a direct reduction from the carrying value of the convertible debt on our consolidated balance sheets.

This amount will be accreted into interest expense in the consolidated statements of comprehensive income using the effective interest method over the term of the 2023 Notes.

Proceeds from the Subscription Transactions were $ 276.1 million, net of debt issuance costs of $ 14.0 million.

The Exchange Transaction resulted in $ 6.2 million of the debt issuance costs related to the modified 2019 Notes, which were expensed as incurred in accordance with modification accounting, and $ 7.8 million of deferred debt issuance costs related to the 2023 Notes, which were recorded as a direct deduction to the carrying value of the 2023 Notes on the Company’s consolidated balance sheets.

The Company will amortize the $ 7.8 million of debt issuance costs of the 2023 Notes into amortization of debt issuance costs in the Company’s consolidated statements of comprehensive income over the remaining term of the 2023 Notes.

The carrying value of the 2023 Notes of $ 510.1 million is included in long-term debt on the Company's consolidated balance sheets as of December 31, 2023.

The Company used $ 14.4 million of the proceeds from the Subscription Transactions to repurchase shares of its common stock from certain purchasers of the 2023 Notes.

See Note 12, “Stockholders’ Equity - Share Repurchases” for additional information related to this repurchase.

The Company will also use a portion of the proceeds to finance in part, the settlement upon conversion or repurchase of the remaining 2019 Notes at or prior to maturity.

The remainder of the proceeds will be used for working capital

and general corporate purposes, including to fund possible acquisitions of, or investments in, complementary businesses, products, services and technologies.

The 2023 Notes are senior, unsecured obligations of the Company, and bear interest at a rate of 1.00 % per year.

Interest is payable semi-annually in arrears on each June 15 and December 15, commencing on June 15, 2024 .

The 2023 Notes will mature on December 15, 2028 , unless earlier redeemed, repurchased or converted.

The initial conversion rate for the 2023 Notes is 4.9247 shares of the Company's common stock per $ 1,000 principal amount of 2023 Notes, which is equivalent to an initial conversion price of $ 203.06 per share and represents a 30 % premium over the last reported sale price of $ 156.20 per share on December 6, 2023, the date on which the 2023 Notes were priced.

Prior to the close of business on the business day immediately preceding September 15, 2028, the 2023 Notes will be convertible at the options of the holders of 2023 Notes only upon the satisfaction of specified conditions and during certain periods into cash up to their principal amount, and into cash, shares of the Company's common stock or a combination thereof, at the Company's election, for the conversion value above the principal amount, if any.

Thereafter until the close of business on the second scheduled trading day immediately preceding the maturity date, the 2023 Notes will be convertible at the option of the holders of 2023 Notes at any time regardless of these conditions.

The Company may redeem for cash, all or a portion of the 2023 Notes, at its option, on or after December 18, 2026 and prior to the 21st scheduled trading day immediately preceding the maturity date at a redemption price of 100 % of the principal amount of the 2023 Notes to be redeemed, plus accrued and unpaid interest to, but excluding the redemption date, if certain conditions are met in accordance to the indenture governing the 2023 Notes (the “2023 Notes Indenture”).

If the Company undergoes a “fundamental change” (as defined in the 2023 Notes Indenture), the holders of the 2023 Notes may require the Company to repurchase for cash all or part of their 2023 Notes at a purchase price equal to 100 % of the principal amount of the 2023 Notes to be repurchased, plus accrued and unpaid interest, if any, up to, but excluding, the fundamental change repurchase date.

In addition, if certain “make-whole fundamental changes” (as defined in 2023 Notes Indenture) occur or the Company calls all or a portion of the 2023 Notes for redemption, the Company will, in certain circumstances, increase the conversion rate for any 2023 Notes converted in connection with such make-whole fundamental change or any 2023 Notes called for redemption that are converted during the related redemption period.

Interest expense recognized on the 2023 Notes in 2023 wa s $ 0.2 million and $ 0.6 million for the contractual coupon interest and accretion of the debt discount, respectively.

Amortization of debt issuance costs recorded in 2023 related to the 2023 Notes was $ 6.3 mill ion, which includes the $ 6.2 million of debt issuance costs recorded under modification accounting mentioned above and $ 0.1 million amortization of debt issuance costs related to the capitalized portion of the costs.

The effective interest rate on the 2023 Notes is 4.39 %, which included the interest on the 2023 Notes and amortization of the debt discount and issuance costs.

As of December 31, 2023, the carrying value of the 2023 Notes was $ 510.1 million and the fair value of the principal was $ 596.0 million.

The fair value of the 2023 Notes was determined based on the most recent trade activity of the 2023 Notes as of December 31, 2023.

The 2023 Notes Indenture contains customary terms and events of default.

If an event of default (other than certain events of bankruptcy, insolvency or reorganization involving the Company) occurs and is continuing, the holders of at least 25 % in aggregate principal amount of the outstanding 2023 Notes may declare 100 % of the principal of, and any accrued and unpaid interest on, all of the 2023 Notes to be due and payable.

Upon the occurrence of certain events of bankruptcy, insolvency or reorganization involving the Company, 100 % of the principal of and accrued and unpaid interest, if any, on all of the 2023 Notes will become due and payable automatically.

Notwithstanding the foregoing, the 2023 Notes provide that, to the extent the Company elects and for up to 365 days, the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants consist exclusively of the right to receive additional interest on the 2023 Notes.

The Company is not aware of any events of default that would allow holders to declare the principal of, and any accrued and unpaid interest on, all of the 2023 Notes to be due and payable.

0.375% Convertible Senior Notes due 2024

T he Company issued $ 287.5 million aggregate principal amount of the 2019 Notes on July 19, 2019 in a transaction which included the underwriters’ exercise in full of an option to purchase an additional $ 37.5 million aggregate principal amount of 2019 Notes (the “Notes Offering”).

The net proceeds of the Notes Offering, after deducting underwriting discounts and

commissions and other related offering expenses payable by the Company, were approximately $ 278.5 million.

Immediately following the closing of the Exchange Transaction mentioned above, $ 69.7 million in aggregate principal amount of the 2019 Notes remain outstanding.

The 2019 Notes are senior, unsecured obligations of the Company, and bear interest at a rate of 0.375 % per year.

Interest is payable semi-annually in arrears on January 15 and July 15 of each year, beginning on January 15, 2020 .

The 2019 Notes will mature on July 15, 2024 , unless earlier repurchased or converted in accordance with their terms.

The initial conversion rate for the 2019 Notes is 8.6749 shares of the Company’s common stock per $ 1,000 principal amount of 2019 Notes (which is equivalent to an initial conversion price of approximately $ 115.28 per share).

The remaining 2019 Notes will mature on July 15, 2024 , unless earlier repurchased or converted in accordance with their terms.

Prior to the close of business on the business day immediately preceding April 15, 2024, the 2019 Notes will be convertible at the option of the holders of 2019 Notes only upon the satisfaction of specified conditions and during certain periods.

Thereafter until the close of business on the second scheduled trading day immediately preceding the maturity date, the 2019 Notes will be convertible at the options of the holders of 2019 Notes at any time regardless of these conditions.

Conversion of the 2019 Notes will be settled in cash, shares of the Company’s common stock or a combination thereof, at the Company’s election.

Thereafter until the close of business on the second scheduled trading day immediately preceding the maturity date, the remaining 2019 Notes will be convertible at the options of the holders of 2019 Notes at any time regardless of these conditions.

Prior to March 4, 2022, conversion of the 2019 Notes could have been settled in cash, shares of the Company’s common stock or a combination thereof, at the Company’s election.

On March 4, 2022, the Company entered into the Second Supplemental Indenture for the 2019 Notes, which irrevocably elected to settle the conversion of the 2019 Notes using a combination of cash and the Company’s common stock, settling the par value of the 2019 Notes in cash and any excess conversion premium in shares.

The 2019 Notes are not redeemable by the Company prior to maturity.

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In connection with certain corporate events, the Company will, under certain circumstances, increase the conversion rate for holders of 2019 Notes who elect to convert their 2019 Notes in connection with such corporate events.

During the fourth quarter of 2022 , the closing price of the Company’s common stock exceeded 130 % of the conversion price of the 2019 Notes for more than 20 trading days of the last 30 consecutive trading days of the quarter.

As a result, the 2019 Notes are convertible at the option of the holders of the 2019 Notes during the first quarter of 2023, the quarter immediately following the quarter when the conditions are met, as stated in the terms of the 2019 Notes.

Expecting to continue meeting these terms, the Company will continue to classify the carrying value of the 2019 Notes as a current liability on the Company’s consolidated balance sheet as of December 31, 2022 .

These conditions have been met since the third quarter of 2020.

As a result, as of the date of this filing, the Company has received requests to convert $ 30,000 aggregate principal amount of the 2019 Notes all of which have settled.

The conversions resulted in the issuance of a nominal number of shares of the Company’s common stock to the note holders.

During the fourth quarter of 2023 , the closing price of the Company’s common stock exceeded 130 % of the conversion price of the 2019 Notes for more than 20 trading days of the last 30 consecutive trading days of the quarter.

As a result, the 2019 Notes are convertible at the option of the holders of the 2019 Notes during the first quarter of 2024, the quarter immediately following the quarter when conditions are met, as stated in the terms of the 2019 Notes.

These conditions have been met each quarter since the third quarter of 2020.

As a result, as of the date of this filing and prior to the Exchange Transaction mentioned above, the Company received requests to convert $ 0.2 million aggregate principal amount of the 2019 Notes and all but $ 0.1 million of the requests have been settled as of December 31, 2023.

The remaining outstanding requests for conversions will settle in the first quarter of 2024.

The conversions resulted in the issuance of a nominal number of shares of the Company’s common stock to the note holders.

Because the 2019 Notes mature within one year of the report date, the Company classifies the carrying value of the 2019 Notes of $ 69.5 million as current liabilities on the Company's consolidated balance sheets at December 31, 2023.

Prior to the adoption of ASU 2020-06, the Company accounted for the 2019 Notes as a liability and equity component where the carrying value of the liability component was valued based on a similar debt instrument.

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The carrying value of the liability component was calculated as the present value of its cash flows using a discount rate of 4.5 % based on comparative convertible transactions for similar companies.

The carrying value of the equity component representing the conversion option was

determined by deducting the fair value of the liability component from the par value of the 2019 Notes as a whole.

The carrying value of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the par value of the 2019 Notes as a whole.

The excess of the principal amount of the liability component over its carrying value amount, referred to as the debt discount, was amortized to interest expense on our consolidated statements of comprehensive income over the five-year term of the 2019 Notes.

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Transaction costs related to the liability component were $ 7.4 million and are amortized to interest expense using the effective interest method over the five-year term of the 2019 Notes.

Transaction costs attributable to the equity component were $ 1.6 million and are netted with the equity component of the 2019 Notes in stockholders' equity of the Company's consolidated balance sheets.

Transaction costs attributable to the equity component were $ 1.6

million and are netted with the equity component of the 2019 Notes in stockholders' equity of the Company's consolidated balance sheets.

Additionally, the Company recorded a net deferred tax liability of $ 11.4 million.

Effective January 1, 2022, the Company adopted ASU 2020-06.

After adoption, the Company now accounts for the 2019 Notes as a single liability measured at amortized cost.

After adoption, the Company now accounts for the 2019 Notes, and any convertible debt issued going forward, as a single liability measured at amortized cost.

As the equity component is no longer required to be split into a separate component, the Company recorded a net adjustment for the initial $ 50.4 million that was allocated to additional paid-in capital and $ 22.9 million of life-to-date interest expense recorded as amortization of debt discount.

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Since the 2019 Notes are classified as a single liability, there is no debt discount required to be amortized in 2022.

Interest expense recognized on the 2019 Notes in 2022 was $ 1.1 million and $ 1.8 mill ion for the contractual coupon interest and the amortization of the debt issuance costs, respectively.

The effective interest rate on the 2019 Notes is 1.01 %, which included the interest on the 2019 Notes, amortization of the debt discount and debt issuance costs.

Contractual coupon interest expense related to the 2019 Notes was $ 1.0 million in 2023 and the Company recorded $ 1.8 mill ion of amortization of the debt issuance costs related to the 2019 Notes as well.

The effective interest rate on the 2019 Notes is 1.02 %, which included the interest on the 2019 Notes and amortization of the debt issuance costs.

As of December 31, 2023, the carrying value of the 2019 Notes was $ 69.5 million and the fair value of the principal was $ 109.8 million.

The fair value of the 2019 Notes was determined based on the most recent trade activity of the 2019 Notes as of December 31, 2023.

The 2019 Notes agreement contains customary terms and events of default.

The indenture governing the 2019 Notes contains customary terms and events of default.

If an event of default (other than certain events of bankruptcy, insolvency or reorganization involving the Company) occurs and is continuing, the holders of at least 25 % in aggregate principal amount of the outstanding 2019 Notes may declare 100 % of the principal of, and any accrued and unpaid interest on, all of the 2019 Notes to be due and payable.

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Notwithstanding the foregoing, the 2019 Notes provide that, to the extent the Company elects and for up to 360 days, the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants consist exclusively of the right to receive additional interest on the 2019 Notes.

The Company is not aware of any events of default, current events or market conditions that would allow holders to call or convert the 2019 Notes as of December 31, 2022 .

Accumulated Other Comprehensive Income (Loss)

Changes in accumulated other comprehensive income (loss) consisted of the following for the years ended December 31, 2022 and 2021 (amounts in thousands):

Balance at December 31, 2020

Other comprehensive loss

Balance at December 31, 2021

Other comprehensive loss

Balance at December 31, 2022

The Company is not aware of any events of default, current events or market conditions that would allow holders to declare the principal of, and any accrued and unpaid interest on, all of 2019 Notes to be due and payable.

Employee Benefit Plans

In the United States, the Repligen Corporation 401(k) Savings and Retirement Plan (the “401(k) Plan”) is a qualified defined contribution plan in accordance with Section 401(k) of the Internal Revenue Code.

employees over the age of 21 are eligible to make pre-tax contributions up to a specified percentage of their compensation.

Under the 401(k) Plan, the Company may, but is not obligated to match a portion of the employees’

contributions up to a defined maximum.

Under the 401(k) Plan, the Company may, but is not obligated to match a portion of the employees’ contributions up to a defined maximum.

The match is calculated on a calendar year basis.

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The Company pays premiums to a third-party occupational pension specialist who administers the pension plan.

These premiums are based on various factors including each employee’s age, salary, employment history and selected benefits in the pension plan.

When an employee terminates or retires, these premium payments cease for that employee and the Company has no further pension-related obligations for that employee.

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Related Party Transactions

Certain facilities leased by Spectrum are owned by the Roy Eddleman Living Trust (the "Trust").

Certain facilities leased by Spectrum LifeSciences LLC (“Spectrum”) are owned by the Roy Eddleman Living Trust (the “Trust”).

As of December 31, 2023 , the Trust owned greater than 5 % of the Company's outstanding shares.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures