Company: OFIX
Filing Date: 2025-02-25
Form Type: 8-K
Source: 0000950170-25-026062
Chunk: 2

Company: Orthofix Medical Inc.
Filing Date: 2025-02-25
Form: 8-K
Item: Item 2.02
Chunk 2
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, including costs relating to integration efforts, severance and retention costs, product rationalization charges, contract termination penalties, and professional fees related to the merger. Management excludes this item when evaluating the Company's operating results as these costs associated with this event are of a temporary nature, are not related to the Company's core operating performance, and are not expected to recur at a similar frequency and magnitude in the future.

• Strategic investments
 - Costs related to the Company's strategic investments, such as due diligence and integration costs (unrelated to the merger with SeaSpine), which are primarily recorded as sales, general, and administrative expenses. These costs are not factored into the evaluation of the Company's performance by management because they are of a temporary nature, not related to the Company's core operating performance, and because the frequency and amount of such costs vary significantly based on the timing and magnitude of the Company's strategic investments.

• Acquisition-related fair value adjustments
 - Comprised of (i) gains and losses related to remeasurement of contingent consideration to fair value, which are recorded as operating expenses, (ii) recognized costs related to acquired in-process research and development ("IPR& D") assets, which are expensed immediately, and (iii) amortization of acquired inventory fair market value adjustments. Management excludes this item when evaluating the Company's operating results as the remeasurement of contingent consideration is primarily non-cash in nature, the frequency and amount of IPR& D charges can vary significantly based on the timing and magnitude of the Company's acquisition transactions, and inventory fair market value adjustments are of a temporary and non-cash nature.

• Amortization of acquired long-lived assets
 - Amortization of intangible assets acquired in business combinations or asset acquisitions, including items such as developed technologies, customer relationships, trade names, manufacturing agreements, and other intangible assets, and any impairment of acquired goodwill, which are recorded in cost of sales or operating expenses. This item also includes depreciation recognized on adjustments to the fair value of certain long-lived assets acquired in the merger with SeaSpine. Management excludes this item when evaluating the Company's operating performance as it represents a non-cash expense.

• (Gain) Loss on investment securities
 - Interest income and net gains or losses recognized (realized or unrealized) within interest income (expense), net and other income (expense), net, respectively, relating to certain of the Company's investments. Management excludes these items when evaluating the Company's operating performance as it typically represents a non