Integer Holdings Corp 10-Q for FY2026 Q2
Integer Holdings Corp (ITGR)
10-Q
2026-08-04
For: 2026-07-03
View Original
Added on
August 04, 2026
About this 10-Q
Integer Holdings Corp filed this 10-Q on August 4, 2026, covering the quarter ended July 3, 2026 (FY2026 Q2).
Headline figures
Quarter ended July 3, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $464.11M
- down 2.6% from $476.49M a year earlier
- Net income
- $23.61M
- down 36.2% from net income of $37.01M a year earlier
- Diluted EPS
- $0.69
- down 33.7% from $1.04 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________________________________
FORM 10-Q
_____________________________________________________________
(Mark One) | ||||||||
QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||
For the quarterly period ended July 3, 2026
or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from ____ to ____
Commission File Number 1-16137
_____________________________________________________________
(Exact name of Registrant as specified in its charter)
_____________________________________________________________
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
| (Address of principal executive offices) | (Zip Code) | ||||||||||||||||
(214 ) 618-5243
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by checkmark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☒ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | |||||||||||||||||||
| Smaller reporting company | Emerging growth company | ||||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
The number of shares outstanding of the Company’s common stock, $0.001 par value per share, as of July 30, 2026 was: 33,992,048 shares.
INTEGER HOLDINGS CORPORATION
Form 10-Q
For the Quarterly Period Ended July 3, 2026
TABLE OF CONTENTS
| Page | |||||||||||
| ITEM 1. | |||||||||||
| ITEM 2. | |||||||||||
| ITEM 3. | |||||||||||
| ITEM 4. | |||||||||||
| ITEM 1. | |||||||||||
| ITEM 1A. | |||||||||||
| ITEM 2. | |||||||||||
| ITEM 5. | |||||||||||
| ITEM 6. | |||||||||||
- 2 -
PART I—FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
INTEGER HOLDINGS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
| (in thousands except share and per share data) | July 3, 2026 | December 31, 2025 | |||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net of provision for credit losses of $ | |||||||||||
| Inventories | |||||||||||
| Contract assets | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
| Property, plant and equipment, net | |||||||||||
| Goodwill | |||||||||||
| Other intangible assets, net | |||||||||||
| Deferred income taxes | |||||||||||
| Operating lease assets | |||||||||||
| Financing lease assets | |||||||||||
| Other long-term assets | |||||||||||
| Total assets | $ | $ | |||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Operating lease liabilities | |||||||||||
| Accrued expenses and other current liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Long-term debt | |||||||||||
| Deferred income taxes | |||||||||||
| Operating lease liabilities | |||||||||||
| Financing lease liabilities | |||||||||||
| Other long-term liabilities | |||||||||||
| Total liabilities | |||||||||||
| Stockholders’ equity: | |||||||||||
Common stock, $ | |||||||||||
| Additional paid-in capital | |||||||||||
Treasury stock, at cost; | ( | ( | |||||||||
| Retained earnings | |||||||||||
| Accumulated other comprehensive income | |||||||||||
| Total stockholders’ equity | |||||||||||
| Total liabilities and stockholders’ equity | $ | $ | |||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
- 3 -
INTEGER HOLDINGS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME (Unaudited)
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| (in thousands except per share data) | July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | |||||||||||||||||||
| Sales | $ | $ | $ | $ | |||||||||||||||||||
| Cost of sales | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Selling, general and administrative | |||||||||||||||||||||||
| Research, development and engineering | |||||||||||||||||||||||
| Restructuring and other charges | |||||||||||||||||||||||
| Total operating expenses | |||||||||||||||||||||||
| Operating income | |||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| (Gain) loss on equity investments | ( | ( | |||||||||||||||||||||
| Other loss, net (see Note 6) | |||||||||||||||||||||||
| Income from continuing operations before taxes | |||||||||||||||||||||||
| Provision (benefit) for income taxes | ( | ||||||||||||||||||||||
| Income from continuing operations | |||||||||||||||||||||||
| Loss from discontinued operations, net of tax | ( | ||||||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||
| Basic earnings per share: | |||||||||||||||||||||||
| Income from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
| Loss from discontinued operations | |||||||||||||||||||||||
| Basic earnings per share | |||||||||||||||||||||||
| Diluted earnings per share: | |||||||||||||||||||||||
| Income from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
| Loss from discontinued operations | |||||||||||||||||||||||
| Diluted earnings per share | |||||||||||||||||||||||
| Weighted average shares outstanding: | |||||||||||||||||||||||
| Basic | |||||||||||||||||||||||
| Diluted | |||||||||||||||||||||||
| Comprehensive Income | |||||||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||
| Other comprehensive income (loss): | |||||||||||||||||||||||
| Foreign currency translation gain (loss) | ( | ( | |||||||||||||||||||||
| Change in fair value of cash flow hedges, net of tax | ( | ( | |||||||||||||||||||||
| Other comprehensive income (loss) | ( | ( | |||||||||||||||||||||
| Comprehensive income | $ | $ | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
- 4 -
INTEGER HOLDINGS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
| Six Months Ended | |||||||||||
| (in thousands) | July 3, 2026 | June 27, 2025 | |||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | $ | |||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Debt related charges included in interest expense | |||||||||||
| Debt conversion inducement expense | |||||||||||
| Stock-based compensation | |||||||||||
| Non-cash fixed asset impairment | |||||||||||
| Non-cash lease expense | |||||||||||
| Non-cash (gains) losses on equity investments | ( | ||||||||||
| Contingent consideration fair value adjustment | ( | ( | |||||||||
| Other non-cash losses | |||||||||||
| Deferred income taxes | |||||||||||
| Gain on sale of discontinued operations | ( | ||||||||||
| Changes in operating assets and liabilities, net of acquisitions: | |||||||||||
| Accounts receivable | ( | ||||||||||
| Inventories | ( | ( | |||||||||
| Prepaid expenses and other assets | ( | ||||||||||
| Contract assets | ( | ||||||||||
| Accounts payable | |||||||||||
| Accrued expenses and other liabilities | ( | ( | |||||||||
| Income taxes | ( | ( | |||||||||
| Net cash provided by operating activities | |||||||||||
| Cash flows from investing activities: | |||||||||||
| Acquisition of property, plant and equipment | ( | ( | |||||||||
| Purchase of equity and other investments, net of distributions | ( | ||||||||||
| Acquisitions, net of cash acquired | ( | ||||||||||
| Other investing activities | |||||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| Cash flows from financing activities: | |||||||||||
| Principal payments of long-term debt | ( | ||||||||||
| Proceeds from issuance of convertible notes, net of discount | |||||||||||
| Proceeds from revolving credit facility | |||||||||||
| Payments of revolving credit facility | ( | ( | |||||||||
| Purchase of capped calls | ( | ||||||||||
| Payment of debt issuance costs | ( | ( | |||||||||
| Repurchases of common stock | ( | ||||||||||
| Proceeds from the exercise of stock options | |||||||||||
| Tax withholdings related to net share settlements of restricted stock unit awards | ( | ( | |||||||||
| Principal payments on finance leases | ( | ( | |||||||||
| Other financing activities | ( | ||||||||||
| Net cash provided by (used in) financing activities | ( | ||||||||||
| Effect of foreign currency exchange rates 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 | $ | $ | |||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
- 5 -
INTEGER HOLDINGS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| (in thousands) | July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | |||||||||||||||||||
| Total stockholders’ equity, beginning balance | $ | $ | $ | $ | |||||||||||||||||||
| Common stock and additional paid-in capital | |||||||||||||||||||||||
| Balance, beginning of period | |||||||||||||||||||||||
| Stock awards exercised or vested | ( | ( | ( | ||||||||||||||||||||
| Stock-based compensation (inclusive of capitalized stock-based compensation) | |||||||||||||||||||||||
| Capped calls related to the issuance of 2030 Notes, net of tax | ( | ||||||||||||||||||||||
| Partial conversion of convertible notes due 2028 Notes and partial unwind of related capped calls, net of tax | |||||||||||||||||||||||
| Issuance of common stock for acquisition | |||||||||||||||||||||||
| Balance, end of period | |||||||||||||||||||||||
| Treasury stock | |||||||||||||||||||||||
| Balance, beginning of period | ( | ( | ( | ||||||||||||||||||||
Treasury shares purchased, including excise tax for 2026 | ( | ( | |||||||||||||||||||||
| Treasury shares reissued | |||||||||||||||||||||||
| Balance, end of period | ( | ( | ( | ( | |||||||||||||||||||
| Retained earnings | |||||||||||||||||||||||
| Balance, beginning of period | |||||||||||||||||||||||
| Net income | |||||||||||||||||||||||
| Balance, end of period | |||||||||||||||||||||||
| Accumulated other comprehensive income | |||||||||||||||||||||||
| Balance, beginning of period | ( | ||||||||||||||||||||||
| Other comprehensive income (loss) | ( | ( | |||||||||||||||||||||
| Balance, end of period | |||||||||||||||||||||||
| Total stockholders’ equity, ending balance | $ | $ | $ | $ | |||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
- 6 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(1.) BASIS OF PRESENTATION
Integer Holdings Corporation (together with its consolidated subsidiaries, “Integer” or the “Company”) is a publicly-traded corporation listed on the New York Stock Exchange under the symbol “ITGR.” Integer is a medical device contract development and manufacturing organization, primarily serving the cardio and vascular, neuromodulation, and cardiac rhythm management markets. The Company’s primary customers include large, multi-national original equipment manufacturers (“OEMs”) and their affiliated subsidiaries.
The accompanying condensed consolidated financial statements are presented in accordance with the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (“SEC”) and do not include all of the disclosures normally required by U.S. generally accepted accounting principles (“U.S. GAAP”) as contained in the Company’s Annual Report on Form 10-K. Accordingly, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s most recent Annual Report on Form 10-K for the year ended December 31, 2025.
In the opinion of management, the condensed consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the results of the Company for the periods presented. The results for interim periods are not necessarily indicative of results or trends that may be expected for the fiscal year as a whole. The condensed consolidated financial statements were prepared using U.S. GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, certain components of equity, sales, expenses, and related disclosures at the date of the financial statements and during the reporting period. Actual results could differ materially from these estimates.
The second quarter and first six months of 2026 ended on July 3 and consisted of 91 days and 184 days, respectively. The second quarter and first six months of 2025 ended on June 27 and consisted of 91 days and 178 days, respectively.
Discontinued Operations
The Company sold Electrochem Solutions, Inc. (“Electrochem”) during the fourth quarter of 2024. The results of operations of the Electrochem business are classified as discontinued operations. There has been no activity from discontinued operations since an immaterial non-cash loss in the first quarter of 2025.
Recent Accounting Pronouncements
In the normal course of business, management evaluates all new Accounting Standards Updates (“ASU”) and other accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”), SEC, or other authoritative accounting bodies to determine the potential impact they may have on the financial position, results of operations or cash flows of the Company. Other than those discussed below, management does not expect any of the recently issued accounting pronouncements, which have not already been adopted, to have a material effect on the financial position, results of operations or cash flows of the Company.
Accounting Guidance to be Adopted in Future Periods
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The ASU is intended to improve disclosures about a public business entity’s expense and provide more detailed information to investors about the types of expenses in commonly presented expense captions. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The ASU will affect only the Company’s disclosures and will not impact its results of operations or financial condition. The Company is currently evaluating the timing of its adoption.
- 7 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(2.) BUSINESS ACQUISITIONS
2025 Acquisitions
Precision Coating LLC Acquisition
On January 7, 2025, the Company acquired substantially all of the assets and assumed certain liabilities of certain subsidiaries of Katahdin Industries, Inc., including its main operating subsidiary, Precision Coating LLC (collectively “Precision”). Prior to the acquisition, Precision was a privately-held manufacturer specializing in high value surface coating technology platforms, including fluoropolymer, anodic coatings, ion treatment solutions and laser processing.
The total consideration transferred was $153.5 million, including contingent consideration, working capital and other purchase price adjustments. The Company recorded contingent consideration with an estimated acquisition date fair value of $1.4 million, representing the Company’s obligation, under the purchase agreement, to make an additional payment of up to $5.0 million based on a specified revenue growth milestone being met in 2025. The revenue growth milestone for Precision was not met for 2025, and the Company determined that no additional consideration was required to be paid.
VSi Parylene Acquisition
On February 28, 2025, the Company acquired substantially all of the assets and assumed certain liabilities of Vertical Solutions, Inc., d/b/a VSi Parylene (“VSi”). Prior to the acquisition VSi was a privately-held full-service provider of parylene coating solutions, primarily focused on complex medical device applications.
The total consideration transferred was $24.0 million, including shares of Integer’s common stock (“Common Stock”) with a fair value of $4.0 million, contingent consideration, working capital and other purchase price adjustments. The Company recorded contingent consideration with an estimated acquisition date fair value of $1.1 million, representing the Company’s obligation, under the purchase agreement, to make additional payments of up to $4.0 million, in the aggregate, based on specified annual revenue growth milestones being met through 2028. See Note 13, “Financial Instruments and Fair Value Measurements,” for additional information related to the fair value measurement of the contingent consideration.
Biocoat Incorporated
On December 4, 2025, the Company acquired certain assets of Biocoat Incorporated (“Biocoat”). Prior to the acquisition, Biocoat was a privately-held manufacturer specializing in high value surface coating technology platforms, including UV and thermal cure hydrophilic coatings.
The total consideration transferred was $15.0 million, including contingent consideration, working capital and other purchase price adjustments. The Company recorded contingent consideration with an estimated acquisition date fair value of $7.0 million, representing the Company’s obligation, under the purchase agreement, to make an additional payment of up to $7.0 million based on specified operational milestones being met after close. See Note 13, “Financial Instruments and Fair Value Measurements,” for additional information related to the fair value measurement of the contingent consideration.
The Company has finalized the purchase price allocation for Precision and VSi and has preliminarily estimated fair values for the assets purchased and liabilities assumed as of the date of the Biocoat acquisition. The determination of estimated fair value required management to make significant estimates and assumptions based on information that was available at the time that the condensed consolidated financial statements were prepared. The amounts reported are considered preliminary as the Company is completing the valuations that are required to allocate the purchase prices in areas such as property and equipment, intangible assets, liabilities and goodwill. As a result, the preliminary allocation of the purchase price may change in the future, including in ways which could be material.
During the first quarter of 2026, certain immaterial measurement period adjustments related to Biocoat were made which resulted in a decrease to property, plant and equipment and an increase to other noncurrent assets. These measurement period adjustments resulted in an immaterial decrease in goodwill when compared to the balance as of December 31, 2025. The changes to the preliminary fair value estimates resulting from the measurement period adjustments recorded during the first quarter of 2026 did not have a material impact to the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income.
- 8 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(2.) BUSINESS ACQUISITIONS (Continued)
The following table summarizes the final purchase price for Precision and VSi and preliminary purchase price allocation for Biocoat (in thousands):
| Precision | VSi | Biocoat | Total | ||||||||||||||||||||
| Fair value of net assets acquired | |||||||||||||||||||||||
| Current assets (excluding inventory) | $ | $ | $ | $ | |||||||||||||||||||
| Inventory | |||||||||||||||||||||||
| Property, plant and equipment | |||||||||||||||||||||||
| Goodwill | |||||||||||||||||||||||
| Intangible assets: | |||||||||||||||||||||||
| Customer relationships | |||||||||||||||||||||||
| Technology | |||||||||||||||||||||||
| Operating lease assets | |||||||||||||||||||||||
| Other noncurrent assets | |||||||||||||||||||||||
| Current liabilities | ( | ( | ( | ( | |||||||||||||||||||
| Operating lease liabilities (noncurrent) | ( | ( | ( | ( | |||||||||||||||||||
| Fair value of net assets acquired | $ | $ | $ | $ | |||||||||||||||||||
- 9 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(3.) SUPPLEMENTAL FINANCIAL STATEMENT DISCLOSURES
Supplemental Cash Flow Information
The following is supplemental information, including discontinued operations, relating to the Condensed Consolidated Statements of Cash Flows (in thousands):
| Six Months Ended | |||||||||||
| July 3, 2026 | June 27, 2025 | ||||||||||
| Noncash investing and financing activities: | |||||||||||
| Property, plant and equipment purchases included in accounts payable | $ | $ | |||||||||
| Accrued excise tax associated with share repurchases | |||||||||||
| Common stock issued for conversion of debt | |||||||||||
| Common stock received under capped call upon conversion of debt | |||||||||||
| Write-off of unamortized deferred costs and original issue discount upon conversion of debt included in Additional paid in capital | |||||||||||
| Common stock issued for acquisition | |||||||||||
| Debt issuance costs incurred but not yet paid | |||||||||||
| Supplemental lease disclosures: | |||||||||||
| Assets acquired under operating leases | |||||||||||
| Assets acquired under finance leases | |||||||||||
Factoring Arrangements
The Company has receivable factoring arrangements, pursuant to which certain receivables may be sold on a non-recourse basis to financial institutions. Factoring fees are recorded in Selling, general, and administrative expenses in the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income. During the six months ended July 3, 2026 and June 27, 2025, the Company sold accounts receivable of $25.1 million and $131.1 million, respectively. The Company recorded factoring fees of $0.1 million for the six months ended July 3, 2026, compared to $0.5 million and $0.9 million, respectively, for the three and six months ended June 27, 2025.
Supplier Financing Arrangements
The Company utilizes supplier financing arrangements with financial institutions to sell certain accounts receivable on a non-recourse basis. Fees for supplier financing arrangements are recorded in Selling, general, and administrative expenses in the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income. During the six months ended July 3, 2026 and June 27, 2025, the Company sold and de-recognized accounts receivable of $84.8 million and $83.5 million, respectively. The Company recorded costs associated with the supplier financing arrangements of $0.4 million and $0.9 million, respectively, for the three and six months ended July 3, 2026, compared to $0.5 million and $1.0 million, respectively, for the three and six months ended June 27, 2025.
(4.) INVENTORIES
Inventories comprise the following (in thousands):
| July 3, 2026 | December 31, 2025 | ||||||||||
| Raw materials | $ | $ | |||||||||
| Work-in-process | |||||||||||
| Finished goods | |||||||||||
| Total | $ | $ | |||||||||
- 10 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(5.) GOODWILL AND OTHER INTANGIBLE ASSETS, NET
Goodwill
The changes in the carrying amount of goodwill for the six months ended July 3, 2026 were as follows (in thousands):
| Medical | |||||||||||||||||
| December 31, 2025 | $ | ||||||||||||||||
| Biocoat acquisition-related adjustments (Note 2) | ( | ||||||||||||||||
| Foreign currency translation | ( | ||||||||||||||||
| July 3, 2026 | $ | ||||||||||||||||
Intangible Assets
Intangible assets comprise the following (in thousands):
| Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||||
| July 3, 2026 | |||||||||||||||||||||||
| Definite-lived: | |||||||||||||||||||||||
| Purchased technology and patents | $ | $ | ( | $ | |||||||||||||||||||
| Customer lists | ( | ||||||||||||||||||||||
| Amortizing tradenames and other | ( | ||||||||||||||||||||||
| Total amortizing intangible assets | $ | $ | ( | $ | |||||||||||||||||||
| Indefinite-lived: | |||||||||||||||||||||||
| Trademarks and tradenames | $ | ||||||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||
| Definite-lived: | |||||||||||||||||||||||
| Purchased technology and patents | $ | $ | ( | $ | |||||||||||||||||||
| Customer lists | ( | ||||||||||||||||||||||
| Amortizing tradenames and other | ( | ||||||||||||||||||||||
| Total amortizing intangible assets | $ | $ | ( | $ | |||||||||||||||||||
| Indefinite-lived: | |||||||||||||||||||||||
| Trademarks and tradenames | $ | ||||||||||||||||||||||
Aggregate intangible asset amortization expense comprises the following (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Cost of sales | $ | $ | $ | $ | |||||||||||||||||||
| Selling, general and administrative expenses | |||||||||||||||||||||||
| Total intangible asset amortization expense | $ | $ | $ | $ | |||||||||||||||||||
Estimated future intangible asset amortization expense based on the carrying value as of July 3, 2026 is as follows (in thousands):
| Remainder of 2026 | 2027 | 2028 | 2029 | 2030 | After 2030 | ||||||||||||||||||||||||||||||
| Amortization Expense | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
- 11 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(6.) DEBT
Long-term debt comprises the following (in thousands):
| July 3, 2026 | December 31, 2025 | ||||||||||||||||||||||||||||||||||
| Principal Amount | Unamortized Discounts and Issuance Costs | Net Carrying Amount | Principal Amount | Unamortized Discounts and Issuance Costs | Net Carrying Amount | ||||||||||||||||||||||||||||||
| Senior Secured Credit Facilities: | |||||||||||||||||||||||||||||||||||
| Revolving credit facilities | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Term loan A | ( | ( | |||||||||||||||||||||||||||||||||
| 2028 Notes | ( | ( | |||||||||||||||||||||||||||||||||
| 2030 Notes | ( | ( | |||||||||||||||||||||||||||||||||
| Total | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
| Current portion of long-term debt | |||||||||||||||||||||||||||||||||||
| Long-term debt | $ | $ | |||||||||||||||||||||||||||||||||
The Company’s debt structure includes senior secured credit facilities (the “Senior Secured Credit Facilities”), unsecured 2.125 % Convertible Senior Notes due in 2028 (the “2028 Notes”), and unsecured 1.875 % Convertible Senior Notes due in 2030 (the “2030 Notes,” and together with the 2028 Notes, the “Convertible Notes”). For additional details regarding the Company’s debt financing, refer to Note 9, “Debt” of the Notes to Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
Senior Secured Credit Facilities
In September 2021, the Company entered into a credit agreement (the “2021 Credit Agreement”), governing the Senior Secured Credit Facilities. As of July 3, 2026, the Company maintained Senior Secured Credit Facilities consisting of a five-year $800 million revolving credit facility (the “Revolving Credit Facility”) and a five-year “term A” loan (the “TLA Facility”). A portion of the Revolving Credit Facility is available for swingline loans of up to a sublimit of $75 million and for the issuance of standby letters of credit of up to a sublimit of $40 million.
Revolving Credit Facility
The Revolving Credit Facility matures on February 15, 2028, and provides for revolving loans in an aggregate amount of $800 million. As of July 3, 2026, the Company had available borrowing capacity on the Revolving Credit Facility of $744.7 million after giving effect to outstanding borrowings and $5.3 million of outstanding standby letters of credit. Borrowings under the Revolving Credit Facility bear interest at a rate based on the secured overnight financing rate (“SOFR”) for the applicable interest period plus an adjustment of 0.10 % per annum, in relation to any loan in U.S. dollars, and the Euro Interbank Offered Rate, in relation to any loan in Euros, plus a margin based on the Company’s Secured Net Leverage Ratio (as defined in the 2021 Credit Agreement). Swingline loans bear interest at a rate based on SOFR plus a margin based on the Company’s Secured Net Leverage Ratio. In addition, the Company is required to pay a commitment fee on the unused portion of the Revolving Credit Facility, which ranges between 0.15 % and 0.25 %, depending on the Company’s Secured Net Leverage Ratio. As of July 3, 2026, the commitment fee on the unused portion of the Revolving Credit Facility was 0.15 %. As of July 3, 2026, the interest rate on the Revolving Credit Facility was 5.00 %.
On March 25, 2026, the Company entered into a fifth amendment (the “Fifth Amendment”) to the 2021 Credit Agreement. The Fifth Amendment amended the terms of the 2021 Credit Agreement to, among other things, increase the portion of the Revolving Credit Facility that is available for swingline loans up to a sublimit of $75 million and to permit swingline loans to bear interest, at the Company’s option, at a rate based on SOFR plus a margin.
TLA Facility
The TLA Facility matures on February 15, 2028. During 2025, the Company prepaid the required quarterly principal installments under the TLA Facility through maturity. The interest rate terms for the TLA Facility are the same as those described above for the Revolving Credit Facility borrowings in U.S. dollars. As of July 3, 2026, the interest rate on the TLA Facility was 5.00 %.
- 12 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(6.) DEBT (Continued)
Contractual principal maturities under the Senior Secured Credit Facilities as of July 3, 2026, are as follows (in thousands):
| Remainder of 2026 | 2027 | 2028 | ||||||||||||||||||||||||||||||||||||
| Future minimum principal payments | $ | $ | $ | |||||||||||||||||||||||||||||||||||
Covenants
The 2021 Credit Agreement contains customary terms and conditions, including representations and warranties and affirmative and negative covenants, as well as financial covenants for the benefit of the lenders under the Revolving Credit Facility and the TLA Facility, which require the Company not to exceed a specified maximum Total Net Leverage Ratio (as defined in the 2021 Credit Agreement) and an interest coverage ratio as of the end of each fiscal quarter. As of July 3, 2026, the Company was in compliance with these financial covenants.
Convertible Notes
The following table summarizes certain terms related to the Company’s current outstanding Convertible Notes:
| Convertible Notes | Maturity Date | Annual Coupon Rate | Annual Effective Interest Rate | Payment Dates for Semi-Annual Interest Payments in Arrears | ||||||||||||||||||||||||||||
| 2028 Notes | February 15, 2028 | February 15 and August 15 | ||||||||||||||||||||||||||||||
| 2030 Notes | March 15, 2030 | March 15 and September 15 | ||||||||||||||||||||||||||||||
Conversion and Redemption Terms of the Notes
The Company’s Notes will mature at their maturity date unless earlier repurchased, redeemed or converted. The Convertible Notes’ initial conversion terms are summarized below:
| Convertible Notes | Free Convertibility Date | Initial Conversion Rate per $1,000 Principal | Initial Conversion Price | Redemption Date | ||||||||||||||||||||||||||||
| 2028 Notes | November 15, 2027 | 11.4681 | $ | February 20, 2026 | ||||||||||||||||||||||||||||
| 2030 Notes | December 15, 2029 | 6.6243 | $ | March 20, 2028 | ||||||||||||||||||||||||||||
The conversion rate is subject to standard anti-dilutive adjustments and adjustments upon the occurrence of specified events.
The Company will settle conversions of the Convertible Notes by paying cash up to the aggregate principal amount of the applicable Convertible Notes to be converted, and cash, shares of Common Stock or a combination thereof, at the Company’s election, in respect of the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the Convertible Notes being converted. The holders of the Convertible Notes may convert all or a portion of such Notes, in multiples of $1,000 principal amounts, prior to certain specified dates (each, a “Free Convertibility Date”) only under the following circumstances (in each case, as applicable to each series of Convertible Notes):
•during any calendar quarter (and only during such calendar quarter), if the last reported sale price of the Common Stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % (for the 2028 Notes) and 150 % (for the 2030 Notes) of the conversion price on each applicable trading day;
•during the five business day period after any ten consecutive trading day period (the “Measurement Period”) in which the trading price (as defined in the applicable indenture) per $1,000 principal amount of the notes for each trading day of the Measurement Period was less than 98 % of the product of the last reported sale price of the Common Stock and the conversion rate in effect on each such trading day;
•if the Company calls any or all of the notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or
•upon the occurrence of specified corporate events (as set forth in the applicable indenture).
On or after the applicable Free Convertibility Date until the close of business on the second scheduled trading day immediately preceding the applicable maturity date, holders of the Convertible Notes may convert all or any portion of the Convertible Notes at their option at the conversion rate then in effect, regardless of the foregoing circumstances.
- 13 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(6.) DEBT (Continued)
The conditional conversion features of the 2028 Notes and 2030 Notes were not triggered during the calendar quarter ended June 30, 2026, therefore, the 2028 Notes and 2030 Notes are not convertible during the calendar quarter ended September 30, 2026 pursuant to the applicable last reported sales price conditions.
If the Company undergoes a fundamental change (as defined in the applicable indenture), subject to certain conditions, holders may require the Company to repurchase for cash all or any portion of such Notes, in principal amounts of $1,000 or a multiple thereof, at a fundamental change repurchase price equal to 100 % of the principal amount of such Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. In addition, following certain corporate events or if the Company issues a notice of redemption, it will, under certain circumstances, increase the conversion rate for holders who elect to convert their Notes in connection with such corporate event or during the relevant redemption period.
The Company may not redeem the Convertible Notes prior to certain dates (the “Redemption Date”). On or after the applicable Redemption Date, the Company may redeem for cash all or any portion of the Convertible Notes if the last reported sale price of its Common Stock has been at least 130 % (for the 2028 Notes) and 140 % (for the 2030 Notes) of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending not more than trading days immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100 % of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the Redemption Date (as defined in the 2030 Notes Indenture).
Convertible Notes Exchange Transactions
On March 18, 2025, the Company used a portion of the remaining net proceeds from the issuance of the 2030 Notes to exchange $383.7 million in aggregate principal amount of the 2028 Notes for an aggregate cash exchange consideration of $384.4 million in cash and 1,553,806 shares of Common Stock (the “Note Exchange Transactions”). The Note Exchange Transactions were considered an induced conversion and, as a result, the Company recorded $46.7 million during the first quarter of 2025 in induced conversion expense within Other loss, net in the Consolidated Statements of Operations. Contemporaneously with the Note Exchange Transactions, the Company terminated a portion of the capped call transactions related to the 2028 Notes and received 436,963 shares of common stock.
Fair Value of the Notes
As of July 3, 2026, the estimated fair value of the 2028 Notes and 2030 Notes was approximately $144.3 million and $977.0 million, respectively. As of December 31, 2025, the estimated fair value of the 2028 Notes and 2030 Notes was approximately $131.5 million and $930.0 million, respectively. The estimated fair value of the Convertible Notes was determined through consideration of quoted market prices. The fair value of the Convertible Notes is categorized in Level 2 of the fair value hierarchy.
Capped Calls
In connection with the issuance of the 2028 Notes and 2030 Notes, the Company entered into privately negotiated capped calls (the “2028 Capped Calls” and “2030 Capped Calls”) (collectively, the “Capped Calls”) with certain financial institutions. The Capped Calls are generally expected to reduce the potential dilution and/or offset the cash payments the Company is required to make in excess of the principal amount of converted Convertible Notes if the market price per share of the Company’s Common Stock is greater than the strike price of the applicable Capped Call (which corresponds to the initial conversion price of the applicable Convertible Notes and is subject to certain adjustments under the terms of the applicable Capped Call), with such reduction and/or offset subject to a cap based on the cap price of the applicable Capped Calls (the “Initial Cap Price”).
Each of the Capped Calls has an initial cap price per share of the Company’s Common Stock, which represented a premium over the last reported sale price of the Company’s Common Stock on the date the corresponding Convertible Notes were priced, and is subject to certain adjustments under the terms of the corresponding agreements. Collectively, the Capped Calls cover, initially, the number of shares of Common Stock underlying the Convertible Notes, subject to anti-dilution adjustments substantially similar to those applicable to the Convertible Notes.
The initial terms for the Capped Calls are presented below:
| Capped Calls | Maturity Date | Initial Strike Price | Initial Cap Price | |||||||||||||||||||||||||||||||||||
| 2028 Capped Calls | February 15, 2028 | $ | $ | |||||||||||||||||||||||||||||||||||
| 2030 Capped Calls | March 15, 2030 | $ | $ | |||||||||||||||||||||||||||||||||||
- 14 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(6.) DEBT (Continued)
For accounting purposes, the Capped Calls are separate transactions, and not integrated with the issuance of the Convertible Notes. As these transactions meet certain accounting criteria, the Capped Calls are recorded in stockholders’ equity and are not accounted for as derivatives. The Convertible Notes and the Capped Calls will be integrated for tax purposes. The accounting impact of this tax treatment results in the Capped Calls being deductible as original issue discount for tax purposes over the term of the Convertible Notes, generating a deferred tax asset which is recognized through equity. The premiums paid for the Capped Calls were recorded, net of a deferred tax asset, as a reduction to additional paid-in capital when they were entered into.
A portion of the 2028 Capped Calls were terminated in conjunction with the Note Exchange Transactions. The fair value of the terminated portion of the 2028 Capped Calls was $26.9 million, which was recorded as an increase to additional paid-in capital. The Company also recorded income tax expense of $4.1 million and a corresponding reduction to the deferred tax asset associated with the terminated portion of the 2028 Capped Calls.
(7.) STOCK-BASED COMPENSATION
The Company maintains certain stock-based compensation plans that were approved by the Company’s stockholders and are administered by the Board of Directors (the “Board”) or the Compensation and Organization Committee (the “Compensation Committee”) of the Board. The stock-based compensation plans provide for the granting of stock options, restricted stock awards, performance awards, time-based restricted stock units (“RSUs”), performance-based RSUs (“PRSUs”), stock appreciation rights and stock bonuses to employees, non-employee directors, consultants, and service providers.
On February 27, 2026, upon recommendation of the Compensation Committee, the Board adopted, subject to stockholder approval, the Integer Holdings Corporation 2026 Omnibus Incentive Plan (the “2026 Plan”). The Company’s stockholders approved the 2026 Plan at the Company’s 2026 annual meeting of stockholders on May 20, 2026, at which time the 2026 Plan replaced the Company’s 2021 Omnibus Incentive Plan (the “2021 Plan”) and the Company ceased granting any new awards under the 2021 Plan.
The number of shares initially reserved for issuance under the 2021 Plan was (i) 1,450,000 plus (ii) the total number of shares of common stock available for issuance under the 2016 Plan, plus (iii) any shares of common stock that are subject to awards forfeited, cancelled, expired, terminated or otherwise lapsed or settled in cash, in whole or in part, without the delivery of shares under the 2016 Plan. The aggregate number of shares initially reserved for issuance under the 2026 Plan is (i) 1,000,000 shares of common stock plus (ii) the total number of shares of our common stock available for issuance under the 2021 Plan, plus (iii) any shares of common stock that are subject to awards outstanding under the 2021 Plan that are later forfeited, cancelled, expired, terminated or otherwise lapsed or settled in cash, in whole or in part, without the delivery of shares under the 2021 Plan. Each of the Company’s 2016 Stock Incentive Plan, 2011 Stock Incentive Plan, 2009 Stock Incentive Plan and 2005 Stock Incentive Plan has expired, and no shares are available for issuance under these expired plans.
Stock-based Compensation Expense
The classification of stock-based compensation expense was as follows (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Cost of sales | $ | $ | $ | $ | |||||||||||||||||||
| Selling, general and administrative | |||||||||||||||||||||||
| Research, development and engineering | |||||||||||||||||||||||
| Restructuring and other charges | ( | ( | |||||||||||||||||||||
| Total stock-based compensation expense | $ | $ | $ | $ | |||||||||||||||||||
- 15 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(7.) STOCK-BASED COMPENSATION (Continued)
Modification of Awards
On April 21, 2025, the Board approved a planned leadership succession under which Joseph W. Dziedzic, the Company’s then President and Chief Executive Officer, continued in that role through October 24, 2025, transitioned to a non‑executive special advisor role, and separated from the Company on March 31, 2026. In connection with his separation, and pursuant to an executive retirement agreement dated April 22, 2025, Mr. Dziedzic received retirement eligibility treatment for his outstanding equity awards in exchange for a release of claims and an extension of post‑termination restrictive covenants.
Effective March 31, 2026, Mr. Dziedzic’s unvested RSUs vested in full, and his outstanding PRSUs vested on a prorated basis in accordance with the applicable award agreements. The PRSUs remain subject to achievement of the applicable performance conditions and will be paid, if earned, pursuant to the original award terms. Absent this modification, all unvested RSUs and PRSUs would have been forfeited upon separation.
The modification was accounted for under ASC 718. On March 31, 2026, the Company reversed previously recognized compensation expense and recognized compensation cost based on the fair value of the modified awards, as follows:
•RSUs: 15,333 unvested RSUs vested immediately, resulting in compensation cost of $1.3 million based on a fair value of $88.00 per share. Previously recognized expense of $0.3 million was reversed, and $1.3 million was recognized on March 31, 2026.
•PRSUs—financial performance conditions: The prorated outstanding awards totaled 18,573 PRSUs, with a fair value of $1.6 million based on a share price of $88.00 . Previously recognized expense of $2.1 million was reversed, and $1.6 million was recognized on March 31, 2026. These awards are no longer subject to a service requirement but remain subject to financial performance conditions.
•PRSUs—market‑based performance conditions: The prorated outstanding awards totaled 16,292 PRSUs, with a fair value of $1.4 million determined using a Monte Carlo valuation model. Previously recognized expense of $2.1 million was reversed, and $1.4 million was recognized on March 31, 2026. These awards are no longer subject to a service requirement but remain subject to market‑based performance conditions.
The incremental impact of the modification was recognized within stock‑based compensation expense during the three months ended April 3, 2026.
Stock Options
The following table summarizes the Company’s stock option activity for the six month period ended July 3, 2026:
| Number of Stock Options | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life (In Years) | Aggregate Intrinsic Value (In Millions) | ||||||||||||||||||||
| Outstanding at December 31, 2025 | $ | ||||||||||||||||||||||
| Exercised | ( | ||||||||||||||||||||||
| Outstanding and exercisable at July 3, 2026 | $ | $ | |||||||||||||||||||||
Time-Based Restricted Stock Units
Most RSUs granted to employees during the six months ended July 3, 2026 vest over a period of three years from the grant date, subject to the recipient’s continuous service to the Company. RSUs are issued to non-employee members of the Board as a portion of their annual retainer and vest quarterly over a period of one year . Non-employee directors that take office other than on the date of an annual meeting receive a prorated portion of the annual equity retainer, as of the date he or she takes office. Any prorated annual equity retainer will vest in equal installments on each regularly scheduled vesting date applicable to non-employee directors who have continuously served since the most recent annual meeting. The grant-date fair value of all RSUs is equal to the closing market price of Integer common stock on the date of grant.
- 16 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(7.) STOCK-BASED COMPENSATION (Continued)
The following table summarizes RSU activity for the six month period ended July 3, 2026:
| Time-Vested Activity | Weighted Average Grant Date Fair Value | ||||||||||
| Nonvested at December 31, 2025 | $ | ||||||||||
| Granted | |||||||||||
| Vested | ( | ||||||||||
| Forfeited | ( | ||||||||||
| Nonvested at July 3, 2026 | $ | ||||||||||
Performance-Based Restricted Stock Units
For the Company’s PRSUs, in addition to service conditions, the ultimate number of shares to be earned (0 % to 200 % of the target award) depends on the achievement of financial and market-based performance conditions, or upon the consummation of a change in control. The financial performance conditions are based on the Company’s sales targets over a three year performance period. The market-based performance conditions are based on the Company’s achievement of a relative total shareholder return performance requirement, on a percentile basis, compared to a defined group of peer companies over a three year performance period.
The following table summarizes PRSU activity for the six month period ended July 3, 2026:
| Performance- Vested Activity | Weighted Average Grant Date Fair Value | ||||||||||
| Nonvested at December 31, 2025 | $ | ||||||||||
| Granted | |||||||||||
Performance adjustment(a) | |||||||||||
| Vested | ( | ||||||||||
| Forfeited | ( | ||||||||||
| Nonvested at July 3, 2026 | $ | ||||||||||
__________
(a)Represents additional PRSUs earned related to above-target achievement of performance conditions, the achievement of which was based upon predefined performance targets established by the Compensation Committee at the initial grant date.
The Company uses a Monte Carlo simulation model to determine the grant-date fair value of awards with market-based performance conditions. The grant-date fair value of all other PRSUs is equal to the closing market price of the Common Stock on the date of grant. The weighted average fair value and assumptions used to value the PRSU awards granted with market-based performance conditions are as follows:
| Six Months Ended | |||||||||||
| July 3, 2026 | June 27, 2025 | ||||||||||
| Weighted average fair value | $ | $ | |||||||||
| Risk-free interest rate | % | % | |||||||||
| Expected volatility | % | % | |||||||||
| Expected life (in years) | |||||||||||
| Expected dividend yield | % | % | |||||||||
The valuation of the market-based PRSUs granted during 2026 and 2025 also reflects a weighted average illiquidity discount of 10.98 % and 8.78 %, respectively, related to a period of up to one-year that recipients are restricted from selling, transferring, pledging or assigning the underlying shares, in the event of vesting.
- 17 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(8.) RESTRUCTURING AND OTHER CHARGES
Restructuring and other charges comprise the following (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Restructuring charges | $ | $ | $ | $ | |||||||||||||||||||
Acquisition and integration costs | |||||||||||||||||||||||
| Other general expenses | |||||||||||||||||||||||
Total restructuring and other charges | $ | $ | $ | $ | |||||||||||||||||||
Restructuring programs
Operational excellence
The Company’s operational excellence initiatives mainly consist of costs associated with executing on its sales force, manufacturing, business process and performance excellence operational strategic imperatives. These projects focus on changing the Company’s organizational structure to match product line growth strategies and customer needs, transitioning its manufacturing process into a competitive advantage and standardizing and optimizing its business processes.
Strategic reorganization and alignment
The Company’s strategic reorganization and alignment initiatives primarily include those that align resources with market conditions and the Company’s strategic direction in order to enhance the profitability of its portfolio of products.
Manufacturing alignment to support growth
The Company’s manufacturing alignment to support growth initiatives are designed to reduce costs, improve operating efficiencies or increase capacity to accommodate growth, which may involve relocation or consolidation of manufacturing operations.
The following table comprises restructuring and restructuring-related charges (gains) by classification in the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Restructuring charges: | |||||||||||||||||||||||
Restructuring and other charges | $ | $ | $ | $ | |||||||||||||||||||
Restructuring-related expenses(a): | |||||||||||||||||||||||
| Cost of sales | |||||||||||||||||||||||
| Selling, general and administrative | |||||||||||||||||||||||
| Research, development and engineering | ( | ||||||||||||||||||||||
Total restructuring and restructuring-related charges | $ | $ | $ | $ | |||||||||||||||||||
__________
(a) Restructuring-related expenses primarily include retention bonuses, consulting expenses, professional fees and equipment relocation costs.
- 18 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(8.) RESTRUCTURING AND OTHER CHARGES (Continued)
The following table summarizes the activity for restructuring reserves (in thousands):
| Operational excellence | Strategic reorganization and alignment | Manufacturing alignment to support growth | Total | ||||||||||||||||||||
| December 31, 2025 | $ | $ | $ | $ | |||||||||||||||||||
| Charges incurred, net of reversals | |||||||||||||||||||||||
| Non-cash charges incurred (included above) | ( | ( | |||||||||||||||||||||
| Cash payments | ( | ( | ( | ( | |||||||||||||||||||
| July 3, 2026 | $ | $ | $ | $ | |||||||||||||||||||
Acquisition and integration costs
Acquisition and integration costs primarily consist of professional fees directly related to completed and contemplated business acquisitions and costs to integrate the systems, processes and organizations acquired. During the three and six months ended July 3, 2026, acquisition and integration costs included a benefit of $1.2 0.7 million recorded during the first quarter of 2026 related to an investment in a convertible debt instrument. See Note 13, “Financial Instruments and Fair Value Measurements,” for additional information related to the fair value measurement of the contingent consideration and the convertible debt instrument.
Acquisition and integration costs comprise the following (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Acquisition costs | $ | ( | $ | $ | $ | ||||||||||||||||||
| Integration costs | |||||||||||||||||||||||
| Acquisition and integration costs | $ | $ | $ | $ | |||||||||||||||||||
| Fair value adjustments included in acquisition costs | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Other general expenses
During the six months ended July 3, 2026 and June 27, 2025, the Company recorded expenses related to other initiatives not described above, which primarily include gains and losses in connection with the disposal of property, plant and equipment.
During the three months ended July 3, 2026, the Company recognized fixed asset impairment charges of $5.9 million related to certain manufacturing equipment. The impairment was triggered by revised expectations and cash flow projections during the quarter regarding the future use of these assets, which indicated that their carrying values were no longer recoverable. The impairment charge was recorded within Restructuring and other charges in the Condensed Consolidated Statement of Operations. The fair value of the impaired assets was determined using both an income-based and a market-based valuation approach, based on a combination of company-specific projected cash flows, market participant assumptions, estimated proceeds from disposition, and other relevant market information, all of which are Level 3 unobservable inputs within the fair value hierarchy. As a result, the carrying value of the affected assets were written down to their respective fair values.
- 19 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(9.) INCOME TAXES
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Income from continuing operations before taxes | $ | $ | $ | $ | |||||||||||||||||||
| Provision (benefit) for income taxes | ( | ||||||||||||||||||||||
| Effective tax rate | ( | % | % | % | % | ||||||||||||||||||
The difference between the Company’s effective tax rates and the U.S. federal statutory income tax rate of 21% for the second quarter and first six months of 2026 is due principally to the net impact of the Company’s earnings outside the U.S., which are generally taxed at rates that differ from the U.S. federal rate, the Net CFC Tested Income (“NCTI”), (formerly Global Intangible Low-Taxed Income (“GILTI”) tax), the Foreign Derived Deduction Eligible Income (“FDDEI”), (formerly, Foreign Derived Intangible Income (“FDII”) deduction), the availability of tax credits and the recognition of certain discrete tax items. The difference between the Company’s effective tax rates and the U.S. federal statutory income tax rate of 21% for the second quarter and first six months of 2025 was due principally to the impact of the Convertible Notes Exchange Transactions, including the nondeductible induced conversion expense and reduction of future original issue discount amortization for U.S. income tax purposes. To a lesser extent, the remaining difference between the Company’s effective tax rate and the U.S. federal statutory income tax rate are consistent with the differences recognized in the second quarter and first six months of 2026 including the net impact of the Company’s earnings outside the U.S., the NCTI, GILTI tax, FDDEI, the availability of tax credits and the recognition of certain discrete tax items.
For the second quarter and first six months of 2026, the Company recorded discrete tax benefits of $3.7 million and $3.6 million, respectively. For the second quarter and first six months of 2025, the Company recorded discrete tax benefits of $0.7 million and $2.2 million, respectively. The discrete tax benefit for the second quarter and first six months of 2026 relates predominantly to a favorable provision to return adjustments, partially offset by shortfalls recognized upon the vesting of RSUs. The discrete tax benefits for the second quarter and first six months of 2025 were predominately related to excess tax benefits from stock-based compensation, net of deductibility limitations.
Unrecognized tax benefits reflect the difference between positions taken or expected to be taken on income tax returns and the amounts reflected in the financial statements. As of July 3, 2026, the Company had unrecognized tax benefits of approximately $2.9 million, substantially all of which would favorably impact the effective tax rate, net of federal benefit on state issues, if recognized.
For a description of the Company’s significant tax matters, reference is made to the financial statements as of and for the year ended December 31, 2025 and Note 13 thereto included in the Company’s 2025 Annual Report.
- 20 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(10.) COMMITMENTS AND CONTINGENCIES
Contingent Consideration Arrangements
The Company records contingent consideration liabilities related to the earn-out provisions for certain acquisitions. See Note 13, “Financial Instruments and Fair Value Measurements” for additional information.
Litigation
On December 10, 2025, a putative class action lawsuit was filed in the United States District Court for the Southern District of New York against Integer and certain of its executives, captioned West Palm Beach Firefighters’ Pension Fund v. Integer Holdings Corporation, et al. In March 2026, the court appointed Pembroke Pines Pension Fund for Firefighters and Police Officers as lead plaintiff and recaptioned the case as Pembroke Pines Pension Fund for Firefighters and Police Officers v. Integer Holdings Corporation. An amended complaint was subsequently filed on April 10, 2026 and alleged violations of the securities laws in the company’s public disclosures. On June 18, 2026, the court granted defendants’ motion to dismiss the amended complaint. On July 22, 2026, the plaintiff filed a notice of appeal.
In addition, the Company is subject to litigation arising from time to time in the ordinary course of its business. The Company does not expect that the ultimate resolution of any pending legal actions will have a material effect on its consolidated results of operations, financial position, or cash flows. However, litigation is subject to inherent uncertainties. As such, there can be no assurance that any pending legal action, which the Company currently believes to be immaterial, will not become material in the future.
- 21 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(11.) EARNINGS PER SHARE (“EPS”)
The following table sets forth a reconciliation of the information used in computing basic and diluted EPS (in thousands, except per share amounts):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Numerator for basic and diluted EPS: | |||||||||||||||||||||||
| Income from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
| Loss from discontinued operations | ( | ||||||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||
| Denominator for basic and diluted EPS: | |||||||||||||||||||||||
| Weighted average shares outstanding - Basic | |||||||||||||||||||||||
| Dilutive effect of share-based awards | |||||||||||||||||||||||
| Dilutive impact of Convertible Notes | |||||||||||||||||||||||
| Weighted average shares outstanding - Diluted | |||||||||||||||||||||||
| Basic earnings per share: | |||||||||||||||||||||||
| Income from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
| Loss from discontinued operations | |||||||||||||||||||||||
| Basic earnings per share | $ | $ | $ | $ | |||||||||||||||||||
| Diluted earnings per share: | |||||||||||||||||||||||
| Income from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
| Loss from discontinued operations | $ | $ | $ | $ | |||||||||||||||||||
| Diluted earnings per share | $ | $ | $ | $ | |||||||||||||||||||
The following table sets forth potential shares of Common Stock that are not included in the diluted earnings per share calculation above because to do so would be anti-dilutive for the periods indicated (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Stock options and RSUs | |||||||||||||||||||||||
| PRSUs | |||||||||||||||||||||||
| Common Stock issuable upon conversion of the 2028 Notes | |||||||||||||||||||||||
- 22 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(12.) STOCKHOLDERS’ EQUITY
Common Stock
The following is a summary of the number of shares of Common Stock issued and outstanding for the six month periods ended July 3, 2026 and June 27, 2025:
| Issued | Treasury Stock | Outstanding | |||||||||||||||
| Beginning balance at December 31, 2025 | ( | ||||||||||||||||
| Stock options exercised | |||||||||||||||||
| Vested and settled RSUs and PRSUs, net of shares withheld to cover taxes | |||||||||||||||||
| Repurchases of common stock | — | ( | ( | ||||||||||||||
| Ending balance at July 3, 2026 | ( | ||||||||||||||||
| Beginning balance at December 31, 2024 | ( | ||||||||||||||||
| Stock options exercised | — | ||||||||||||||||
| Vested and settled RSUs and PRSUs, net of shares withheld to cover taxes | — | ||||||||||||||||
| Stock issued upon conversion of convertible debt | — | ||||||||||||||||
| Exercise of capped call upon conversion of convertible debt | — | ( | ( | ||||||||||||||
| Stock issued for acquisition | — | ||||||||||||||||
| Ending balance at June 27, 2025 | ( | ||||||||||||||||
Share Repurchase Program
On November 4, 2025, the Company announced that the Board had approved a share repurchase program whereby the Company may, from time to time, repurchase on the open market, in privately-negotiated purchases, including accelerated repurchases, or otherwise, up to $200.0 million of its common stock (the “Share Repurchase Program”). The Share Repurchase Program has no expiration date and will continue until otherwise suspended or terminated. The Share Repurchase Program does not obligate the Company to repurchase any dollar amount or number of shares and may be executed at the discretion of management on an opportunistic basis, or pursuant to trading plans or other arrangements. Shares of our common stock repurchased under the Share Repurchase Program are classified as treasury stock and recorded at cost on the Consolidated Balance Sheets.
On February 19, 2026, the Company entered into an accelerated share repurchase agreement (“ASR Agreement”) with Bank of America, N.A. ("Bank of America") to repurchase approximately $50.0 million of common stock under the Share Repurchase Program. Under the terms of the ASR Agreement, the Company paid Bank of America $50.0 million on February 19, 2026 and on that date received initial delivery of 462,535 shares, representing approximately 80 % of the shares to be repurchased over the course of the ASR Agreement. On April 2, 2026, Bank of America delivered 127,070 additional shares which completed the ASR Agreement totaling 589,605 repurchased shares. The total number of shares ultimately repurchased under the ASR Agreement was based on the volume-weighted average price of the Company’s Common Stock during the repurchase period under the ASR Agreement, less a discount, which was $84.80 over the term of the ASR Agreement. The Company used available cash and borrowings under our credit facility to fund the repurchase of the common shares under the ASR Agreement. As of July 3, 2026, the Company had $100 million of capacity remaining under the Share Repurchase Program.
- 23 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(12.) STOCKHOLDERS’ EQUITY (Continued)
Accumulated Other Comprehensive Income
Accumulated other comprehensive income (“AOCI”) comprises the following (in thousands):
| Defined Benefit Plan Liability | Cash Flow Hedges | Foreign Currency Translation Adjustment | Total Pre-Tax Amount | Tax | Net-of-Tax Amount | ||||||||||||||||||||||||||||||
| April 3, 2026 | $ | ( | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
| Unrealized gain on cash flow hedges | — | — | ( | ||||||||||||||||||||||||||||||||
| Realized gain on foreign currency hedges | — | ( | — | ( | ( | ||||||||||||||||||||||||||||||
| Foreign currency translation loss | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||
| July 3, 2026 | $ | ( | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
| December 31, 2025 | $ | ( | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
| Unrealized gain on cash flow hedges | — | — | ( | ||||||||||||||||||||||||||||||||
| Realized gain on foreign currency hedges | — | ( | — | ( | ( | ||||||||||||||||||||||||||||||
| Foreign currency translation loss | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||
| July 3, 2026 | $ | ( | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
| March 28, 2025 | $ | $ | ( | $ | $ | $ | $ | ||||||||||||||||||||||||||||
| Unrealized gain on cash flow hedges | — | — | ( | ||||||||||||||||||||||||||||||||
| Realized gain on foreign currency hedges | — | ( | — | ( | ( | ||||||||||||||||||||||||||||||
| Foreign currency translation gain | — | — | |||||||||||||||||||||||||||||||||
| June 27, 2025 | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
| December 31, 2024 | $ | $ | ( | $ | ( | $ | ( | $ | $ | ( | |||||||||||||||||||||||||
| Unrealized gain on cash flow hedges | — | — | ( | ||||||||||||||||||||||||||||||||
| Realized loss on foreign currency hedges | — | — | ( | ||||||||||||||||||||||||||||||||
| Foreign currency translation gain | — | — | |||||||||||||||||||||||||||||||||
| June 27, 2025 | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
- 24 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(13.) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
Assets and Liabilities Measured at Fair Value on a Recurring Basis
Fair value measurement standards apply to certain financial assets and liabilities that are measured at fair value on a recurring basis (each reporting period). For the Company, these financial assets and liabilities include its derivative instruments and contingent consideration. The Company does not have any nonfinancial assets or liabilities that are measured at fair value on a recurring basis.
The Company is exposed to global market risks, including the effect of changes in interest rates and foreign currency exchange rates, and may use derivatives to manage these exposures that occur in the normal course of business. The Company does not hold or issue derivatives for trading or speculative purposes. All derivatives are recorded at fair value on the Condensed Consolidated Balance Sheets.
The following tables provide information regarding assets and liabilities recorded at fair value on a recurring basis (in thousands):
| Fair Value | Quoted Prices in Active Markets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||
| July 3, 2026 | |||||||||||||||||||||||
| Assets: Foreign currency hedging contracts | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: Foreign currency hedging contracts | |||||||||||||||||||||||
| Liabilities: Contingent consideration | |||||||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||
| Liabilities: Foreign currency hedging contracts | $ | $ | $ | $ | |||||||||||||||||||
| Liabilities: Contingent consideration | |||||||||||||||||||||||
Derivatives Designated as Hedging Instruments
Foreign Currency Contracts
The Company periodically enters into foreign currency forward contracts to hedge its exposure to foreign currency exchange rate fluctuations in its international operations. The Company has designated these foreign currency forward contracts as cash flow hedges.
Information regarding outstanding foreign currency forward contracts as of July 3, 2026 is as follows (dollars in thousands):
| Notional Amount | Maturity Date | $/Foreign Currency | Fair Value | Balance Sheet Location | ||||||||||||||||||||||||||||
| $ | Jul 2027 | MXN Peso | $ | Prepaid expenses and other current assets | ||||||||||||||||||||||||||||
| Jul 2027 | MYR Ringgit | Prepaid expenses and other current assets | ||||||||||||||||||||||||||||||
| Jul 2027 | UYU Peso | Prepaid expenses and other current assets | ||||||||||||||||||||||||||||||
| Jul 2027 | Euro | ( | Accrued expenses and other current liabilities | |||||||||||||||||||||||||||||
| Jul 2027 | MXN Peso | ( | Accrued expenses and other current liabilities | |||||||||||||||||||||||||||||
| Apr 2027 | MYR Ringgit | ( | Accrued expenses and other current liabilities | |||||||||||||||||||||||||||||
| Apr 2027 | UYU Peso | ( | Accrued expenses and other current liabilities | |||||||||||||||||||||||||||||
| Oct 2027 | MXN Peso | ( | Other long-term liabilities | |||||||||||||||||||||||||||||
- 25 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(13.) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued)
Information regarding outstanding foreign currency forward contracts as of December 31, 2025 is as follows (dollars in thousands):
| Notional Amount | Maturity Date | $/Foreign Currency | Fair Value | Balance Sheet Location | ||||||||||||||||||||||||||||
| $ | Oct 2026 | Euro | $ | Prepaid expenses and other current assets | ||||||||||||||||||||||||||||
| Oct 2026 | UYU Peso | Prepaid expenses and other current assets | ||||||||||||||||||||||||||||||
| Dec 2026 | MXN Peso | Prepaid expenses and other current assets | ||||||||||||||||||||||||||||||
| Oct 2026 | MYR Ringgit | Prepaid expenses and other current assets | ||||||||||||||||||||||||||||||
| Apr 2027 | MXN Peso | Other long-term assets | ||||||||||||||||||||||||||||||
| Jul 2026 | Euro | ( | Accrued expenses and other current liabilities | |||||||||||||||||||||||||||||
The following tables present the effect of cash flow hedge derivative instruments on the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income for the three and six months ended July 3, 2026 and June 27, 2025 (in thousands):
| Three Months Ended | ||||||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | |||||||||||||||||||||||||
| Total | Amount of Gain (Loss) on Cash Flow Hedge Activity | Total | Amount of Gain (Loss) on Cash Flow Hedge Activity | |||||||||||||||||||||||
| Sales | $ | $ | ( | $ | $ | |||||||||||||||||||||
| Cost of sales | ||||||||||||||||||||||||||
| Operating expenses | ( | |||||||||||||||||||||||||
| Six Months Ended | ||||||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | |||||||||||||||||||||||||
| Total | Amount of Gain (Loss) on Cash Flow Hedge Activity | Total | Amount of Gain (Loss) on Cash Flow Hedge Activity | |||||||||||||||||||||||
| Sales | $ | $ | ( | $ | $ | |||||||||||||||||||||
| Cost of sales | ( | |||||||||||||||||||||||||
| Operating expenses | ( | ( | ||||||||||||||||||||||||
- 26 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(13.) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued)
| Unrealized Gain (Loss) Recognized in OCI | Realized Gain (Loss) Reclassified from AOCI | |||||||||||||||||||||||||||||||
| Three Months Ended | Location in Statements of Operations and Comprehensive Income | Three Months Ended | ||||||||||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | |||||||||||||||||||||||||||||
| Foreign exchange contracts | $ | ( | $ | Sales | $ | ( | $ | |||||||||||||||||||||||||
| Foreign exchange contracts | Cost of sales | |||||||||||||||||||||||||||||||
| Foreign exchange contracts | Operating expenses | ( | ||||||||||||||||||||||||||||||
| Six Months Ended | Six Months Ended | |||||||||||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | |||||||||||||||||||||||||||||
| Foreign exchange contracts | $ | ( | $ | Sales | $ | ( | $ | |||||||||||||||||||||||||
| Foreign exchange contracts | Cost of sales | ( | ||||||||||||||||||||||||||||||
| Foreign exchange contracts | Operating expenses | ( | ( | |||||||||||||||||||||||||||||
The Company expects to reclassify net gains totaling $1.2 million related to its cash flow hedges from AOCI into earnings during the next twelve months.
Derivatives Not Designated as Hedging Instruments
The Company also has foreign currency exposure on balances, primarily intercompany, that are denominated in a foreign currency and are adjusted to current values using period-end exchange rates. To minimize foreign currency exposure, the Company enters into foreign currency contracts with a one month maturity. At July 3, 2026 and December 31, 2025, the Company had total notional amounts of $66.5 million and $73.4 million, respectively, of foreign currency contracts outstanding that were not designated as hedges. The fair value of derivatives not designated as hedges was not material for any period presented. Gains/losses on foreign currency contracts not designated as hedging instruments are included in Other loss, net on the Condensed Consolidated Statements of Operations and Comprehensive Income. The Company recorded net losses of $0.4 2.6 million and $2.2 million, respectively, for the three and six months ended June 27, 2025.
Contingent Consideration
The following table presents the changes in the estimated fair values of the Company’s liabilities for contingent consideration measured using significant unobservable inputs (Level 3) for the three and six months ended July 3, 2026 and June 27, 2025 (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Fair value measurement at beginning of period | $ | $ | $ | $ | |||||||||||||||||||
Amount recorded for current year acquisitions | |||||||||||||||||||||||
| Fair value measurement adjustment | ( | ( | ( | ( | |||||||||||||||||||
| Fair value measurement at end of period | $ | $ | $ | $ | |||||||||||||||||||
As of July 3, 2026, the contingent consideration liability was classified as current. As of December 31, 2025, the current and non-current portions of the contingent consideration liability were $7.0 1.2
The Company will make earnout payments in 2026 of up to $7.0 million based on the achievement of specified milestones being met in 2026. The significant unobservable inputs used to calculate the fair value of the contingent consideration for all acquisitions other than Biocoat are projected revenue for the remaining earnout periods. The payment related to the Biocoat acquisition is contingent upon specified operational milestones being met after close.
- 27 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(13.) FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Continued)
During the three months ended July 3, 2026, the Company assessed the probability of meeting the required revenue thresholds for the VSi acquisition as unlikely and recorded a fair value measurement adjustment totaling $1.2 million in Restructuring and other charges in the Condensed Consolidated Statements of Operations and Comprehensive Income. Actual results will differ from the projected results and could have a significant impact on the estimated fair value of the contingent considerations.
The following table provides information on unpaid contingent consideration as of July 3, 2026 (in thousands):
| As of July 3, 2026 | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Maximum Remaining Payout (undiscounted) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition | Acquisition Date | RemainingMilestone Years | 2026 | 2027 | 2028 | 2029 | Total | Fair Value | ||||||||||||||||||||||||||||||||||||||||||
Biocoat | 12/04/25 | 2026 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
| VSi | 02/28/25 | 2026 - 2028 | ||||||||||||||||||||||||||||||||||||||||||||||||
| InNeuroCo | 10/01/23 | 2026 - 2027 | ||||||||||||||||||||||||||||||||||||||||||||||||
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis
Fair value standards also apply to certain assets and liabilities that are measured at fair value on a nonrecurring basis. The carrying amounts of cash, accounts receivable, accounts payable, and accrued expenses approximate fair value because of the short-term nature of these items. Borrowings under the Company’s Revolving Credit Facility and TLA Facility accrue interest at a floating rate tied to a standard short-term borrowing index, selected at the Company’s option, plus an applicable margin. The carrying amount of this floating rate debt approximates fair value based upon the respective interest rates adjusting with market rate adjustments.
Equity and Other Investments
The Company holds long-term, strategic investments in companies to promote business and strategic objectives. These investments are included in Other long-term assets on the Condensed Consolidated Balance Sheets.
Equity and other investments comprise the following (in thousands):
| July 3, 2026 | December 31, 2025 | ||||||||||||||||||||||
| Equity method investment | $ | $ | |||||||||||||||||||||
| Non-marketable equity securities | |||||||||||||||||||||||
| Convertible debt instrument | |||||||||||||||||||||||
Total equity and other investments | $ | $ | |||||||||||||||||||||
During the first quarter of 2026, the Company invested 12 million euro ($13.8 million) in a convertible debt instrument issued by a life sciences company that matures on December 31, 2035. The instrument has a stated interest of 4.55 %, payable periodically during the term of the instrument. Depending on certain operational and financial targets, the Company may invest an additional 3 million euro under the same terms. The instrument is senior to all other indebtedness, and is secured by the assets of the investee. The Company considered guidance within ASC 815 and concluded the conversion option did not require bifurcation as an embedded derivative instrument.
The components of (Gain) loss on equity investments for each period were as follows (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Equity method investment (gain) loss | $ | ( | $ | $ | $ | ( | |||||||||||||||||
The Company’s equity method investment is in a venture capital fund focused on investing in life sciences companies. As of July 3, 2026 and December 31, 2025, the Company owned 8.0
- 28 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(14.) SEGMENTS AND DISAGGREGATED REVENUE
The Company operates as one
The following table presents Property, Plant and Equipment (“PP&E”) by geographic area. In these tables, PP&E is aggregated based on the physical location of the tangible long-lived assets (in thousands):
| July 3, 2026 | December 31, 2025 | ||||||||||
| Long-lived tangible assets by geographic area: | |||||||||||
| United States | $ | $ | |||||||||
| Ireland | |||||||||||
| Mexico | |||||||||||
| Rest of world | |||||||||||
| Total | $ | $ | |||||||||
The following table presents sales by product line (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Cardio & Vascular | $ | $ | $ | $ | |||||||||||||||||||
Cardiac Rhythm Management & Neuromodulation | |||||||||||||||||||||||
| Other Markets | |||||||||||||||||||||||
| Total sales | $ | $ | $ | $ | |||||||||||||||||||
Revenue recognized from products and services transferred to customers over time represented 35 % and 36 %, respectively, of total revenue for the three and six months ended July 3, 2026, compared to 32 % and 33 %, respectively, for the three and six months ended June 27, 2025.
The following tables present revenues by significant customers, which are defined as any customer who individually represents 10% or more of total revenues.
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Customer A | |||||||||||||||||||||||
| Customer B | |||||||||||||||||||||||
| Customer C | |||||||||||||||||||||||
| All other customers | |||||||||||||||||||||||
- 29 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(14.) SEGMENTS AND DISAGGREGATED REVENUE (Continued)
The following tables present revenues by significant ship to location, which is defined as any country where 10% or more of total revenues are shipped.
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| United States | |||||||||||||||||||||||
| Costa Rica | * | * | |||||||||||||||||||||
| All other countries | |||||||||||||||||||||||
_____
* Less than 10% of total revenues for the period.
Contract Balances
The opening and closing balances of the Company’s contract assets and contract liabilities are as follows (in thousands):
| July 3, 2026 | December 31, 2025 | ||||||||||
| Contract assets | $ | $ | |||||||||
| Contract liabilities (included in Accrued expenses and other current liabilities) | |||||||||||
| Contract liabilities (included in Other long-term liabilities) | |||||||||||
During the three and six months ended July 3, 2026, the Company recognized $1.4 million and $2.8 million, respectively, of revenue that was included in the contract liability balance as of December 31, 2025. During the six months ended June 27, 2025, the Company recognized $0.6 million and $1.8 million, respectively, of revenue that was included in the contract liability balance as of December 31, 2024.
- 30 -
INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(15.) SUBSEQUENT EVENT
On August 2, 2026, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement,” and the transactions contemplated thereby, the “Transaction”), by and among the Company, Armstrong Parent, Inc., a Delaware corporation (“Parent”), and Armstrong Bidco, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”). Parent and Merger Sub are each affiliates of investment funds managed by Kohlberg Kravis Roberts & Co. L.P., a leading global investment firm. Pursuant to the Merger Agreement, and upon the terms and subject to the conditions therein, Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned subsidiary of Parent. If the Merger is consummated, the Company’s securities will be delisted from NYSE as soon as practicable following the Effective Time (defined below), and the Company will become a privately held company.
Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger (the “Effective Time”), each share of common stock of the Company, par value $0.001 per share (the “Company Common Shares”) issued and outstanding immediately prior to the Effective Time, (other than Company Common Shares (i) held by the Company as a treasury share or owned by Parent, Merger Sub or any other Subsidiary of Parent immediately prior to the Effective Time, (ii) held by any subsidiary of the Company immediately prior to the Effective Time and (iii) held by any person who is entitled to demand, and has properly demanded, appraisal in respect of such Company Common Shares pursuant to applicable law), will automatically be converted into the right to receive $127.00 in cash, without interest (the “Merger Consideration”).
Outstanding equity awards will generally be treated as follows: (i) vested restricted stock unit (“RSU”) awards and 50 % of unvested RSU awards will be canceled in exchange for a cash amount based on the Merger Consideration, and 50 % of unvested RSUs will be converted into a deferred cash award based on the Merger Consideration that vests based on the original RSU award’s vesting conditions (with certain termination vesting protections); (ii) performance stock unit (“PSU”) awards for which the performance period is completed but that has not yet been settled will be canceled in exchange for a cash amount equal to the Merger Consideration based on actual performance, and PSU awards with open performance periods will be converted into a cash amount based on the Merger Consideration assuming the greater of target and actual performance, with 50 % of such amount being paid as soon as practicable (assessed on a tranche-by-tranche basis) and the remaining 50 % of such amount being paid subject to satisfaction of the original PSU award’s service vesting conditions (with certain termination vesting protections and without regard to any performance conditions); and (iii) stock options will be vested and canceled in exchange for a cash amount equal to the excess (if any) of the Merger Consideration over the applicable exercise price.
The consummation of the Merger is subject to certain customary closing conditions set forth in the Merger Agreement, including: (i) the approval and adoption of the Merger Agreement by the holders of a majority of the outstanding Company Common Shares (the “Company Stockholder Approval”); (ii) the absence of any order issued by any governmental authority (whether temporary, preliminary or permanent) of competent jurisdiction, or applicable law prohibiting, rendering illegal or enjoining the consummation of the Merger; (iii) the expiration or termination of any waiting periods applicable to the consummation of the Merger under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and certain other applicable antitrust and foreign direct investment laws of certain jurisdictions; (iv) each party’s performance of and compliance with its covenants, obligations and agreements contained in the Merger Agreement in all material respects; (v) no Company Material Adverse Effect (as defined in the Merger Agreement) having occurred since the date of the Merger Agreement and (vi) the accuracy of the representations and warranties of the parties in the Merger Agreement (subject to customary materiality qualifiers). The Merger is not subject to any financing condition, and Parent and Merger Sub have obtained equity and debt financing commitments for the Transaction.
Subject to certain exceptions, the Company has agreed not to solicit alternative acquisition proposals, engage in discussions with any third party regarding alternative acquisition proposals or change its recommendation to its stockholders in favor of the Merger.
The Merger Agreement contains certain customary termination rights for each of the Company and Parent, including, (i) by mutual written agreement of the Company and Parent, (ii) if the Merger has not been consummated on or before May 2, 2027 (the “Outside Date”), (iii) any applicable order, writ, injunction, judgment or decree of any governmental authority (an “Order”) issued by any governmental authority of competent jurisdiction rendering illegal, or restraining, enjoining or otherwise prohibiting the consummation of the Merger and such Order has become final and nonappealable, (iv) the Company Stockholder Approval shall not have been obtained at a meeting of holders of the Company Common Shares (the “Company Stockholders Meeting”) or (v) the other party is in breach of any representation or warranty or failure to perform any covenant or agreement on the part of the respective parties in a manner that would result in a failure of an applicable closing condition and such breach cannot be cured or, if curable, has not been cured within 20 business days after notice to the other party of such breach (or, if earlier, business days prior to the Outside Date).
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INTEGER HOLDINGS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(15.) SUBSEQUENT EVENT (Continued)
In addition, prior to receipt of the Company Stockholder Approval, (i) the Company may also terminate the Merger Agreement to (A) accept a Superior Proposal, subject to Parent’s right to match such Superior Proposal and payment to Parent of the Company Termination Fee (as described below), or (B) in circumstances relating to Parent’s breach of the Merger Agreement or failure to consummate the Merger when it is required to do so under the Merger Agreement, subject to payment to the Company of the Parent Termination Fee (as defined below) and (ii) Parent may terminate the Merger Agreement if the Board of Directors changes its recommendation to the Company’s stockholders regarding the Merger Agreement (an “Adverse Recommendation Change”).
The Merger Agreement provides for the payment of termination fees upon termination of the Merger Agreement under certain specified circumstances. The Company will be obligated to pay Parent a termination fee of $154 million (the “Company Termination Fee”) if the Merger Agreement is terminated (i) by the Company to accept a Superior Proposal, (ii) by Parent following an Adverse Recommendation Change, or (iii) in certain circumstances by either Parent or the Company and prior to such termination a bona fide acquisition proposal is publicly announced or publicly disclosed and not publicly withdrawn or otherwise abandoned at least business days prior to such termination of the Merger Agreement or the date of the Company Stockholders Meeting and the Company enters into a definitive agreement for, or consummates, a transaction involving a Superior Proposal within twelve months of such termination.
Parent will be obligated to pay the Company a termination fee of $307 million (the “Parent Termination Fee”) if the Merger Agreement is terminated by the Company in certain circumstances relating to Parent’s breach of the Merger Agreement or failure to consummate the Merger when it is required to do so under the Merger Agreement.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Quarterly Report on Form 10-Q should be read in conjunction with the disclosures included in our Annual Report on Form 10-K for the year ended December 31, 2025. In addition, please read this section in conjunction with our Condensed Consolidated Financial Statements and Notes to Condensed Consolidated Financial Statements contained herein.
Cautionary Note Regarding Forward-Looking Statements
Some statements contained in this report and other written and oral statements made from time to time by us and our representatives are not statements of historical or current fact. As such, they are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act, and are subject to the safe harbor created thereby under the Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our current expectations, and these statements are subject to known and unknown risks, uncertainties and assumptions. Forward-looking statements include, but are not limited to, statements relating to:
•the proposed Merger (as defined herein), its timing and its consummation;
•our anticipated financial performance related to the Merger, including the benefits of and synergies related to the proposed Merger;
•potential strategic implications as a result of the proposed Merger;
•supply chain pressures on the Company and our business;
•future development and expected growth of our business and industry;
•the success of our acquisition strategy;
•our ability to develop new innovative products;
•our ability to execute our business model and our business strategy;
•the pipeline of opportunities we intend to pursue in our markets, as well as the timing of launch and value of new products;
•having available sufficient cash and borrowing capacity to meet working capital, debt service and capital expenditure requirements for the next twelve months; and
•projected contractual debt service obligations.
You can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “forecast,” “outlook,” “assume,” “potential” or “continue” or variations or the negative counterparts of these terms or other comparable terminology. These statements are only predictions and are no guarantee of future performance, and investors should not place undue reliance on forward-looking statements as predictive of future results. Actual events or results may differ materially from those stated or implied by these forward-looking statements. In evaluating these statements and our prospects, you should carefully consider the factors set forth below. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary factors and to others contained throughout this report. We disclaim any obligation to publicly update or revise the forward-looking statements made in this report as a result of new information, future events or otherwise, except as required by law.
While it is not possible to create a comprehensive list of all factors that may cause actual results to differ from results expressed or implied by our forward-looking statements or that may affect our future results, some of these factors include, but in no way are limited to, the following:
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•risks related to the Merger, including the expected timing and likelihood of completion of the Merger, the timing, receipt and terms and conditions of any required governmental and regulatory approvals; the occurrence of any event, change or other circumstances that could give rise to the termination of the Merger Agreement; the possibility that our stockholders may not approve the Merger; the risk that the parties may not be able to satisfy the conditions to the Merger in a timely manner or at all; risks related to disruption of management time from ongoing business operations due to the Merger; the risk that any announcements relating to the Merger could have adverse effects on the market price of our common stock; the risk that the Merger and its announcement could have an adverse effect on the parties’ business relationships and business generally, including our ability to retain customers and retain and hire key personnel and maintain relationships with their suppliers and customers, and on their operating results and businesses generally; the risk of unforeseen or unknown liabilities; customer, stockholder, regulatory and other stakeholder approvals and support; the risk of unexpected future capital expenditures; the risk of potential litigation relating to the Merger that could be instituted against us or our directors and/or officers; the risk associated with third party contracts containing material consent, anti-assignment, transfer or other provisions that may be related to the Merger which are not waived or otherwise satisfactorily resolved;
•operational risks, such as our dependence upon a limited number of customers; reductions, delays or cancellations in demand from any significant customer or group of customers; pricing pressures and contractual pricing restraints we face from customers; our reliance on third-party suppliers for raw materials, key products and subcomponents; the cost of raw materials, products and subcomponent that are incorporated into our products; trade regulations; changes in order forecasts; our ability to predict and meet the demand for our products; interruptions in our manufacturing operations; uncertainty surrounding macroeconomic and geopolitical factors in the U.S. and globally; our ability to attract, train and retain a sufficient number of qualified associates to maintain and grow our business; the potential for harm to our reputation and competitive advantage caused by quality problems related to our products; our ability to successfully implement a new global enterprise resource planning (“ERP”) solution; our dependence upon our information technology systems and our ability to prevent cyber-attacks and other failures; global climate change and the emphasis on ESG (as defined below) matters by various stakeholders; our dependence upon our senior management team and key technical personnel; and consolidation in the healthcare industry both at a competitor and customer level, resulting in increased competition and pricing pressure;
•strategic risks, such as the intense competition we face and our ability to successfully market our current or new products; our ability to recover the R&D investments made in the development of new products; our customers in-sourcing or dual sourcing production; our ability to respond to changes in technology; our ability to develop new products and expand into new geographic and product markets; and our ability to successfully identify, make and integrate acquisitions to expand and develop our business in accordance with expectations;
•market, financial and indebtedness risks, such as our ability to accurately forecast future performance based on operating results that often fluctuate; the volatility of our stock price; our failure to meet our publicly announced outlook; the ability of our stock purchase program to enhance stockholder value; stockholder activism; our significant amount of outstanding indebtedness and our ability to remain in compliance with financial and other covenants under the credit agreement governing our senior secured credit facilities (“Senior Secured Credit Facilities”); economic and credit market uncertainties that could interrupt our access to capital markets, borrowings or financial transactions; the conditional conversion feature of the 2028 Notes (as defined below) and the 2030 Notes (as defined below) adversely impacting our liquidity; the conversion of our 2028 Notes and 2030 Notes; diluting ownership interests of existing holders of our common stock; the counterparty risk associated with our capped call transaction; the financial and market risks related to our international operations and sales; our complex international tax profile; and our ability to realize the full value of our intangible assets;
•legal and compliance risks, such as legal proceedings against us; regulatory issues resulting from product complaints, recalls or regulatory audits; the potential of becoming subject to product liability or intellectual property claims; our ability to protect our intellectual property and proprietary rights; our ability to comply with customer-driven policies and third-party standards or certification requirements; our ability to obtain and/or retain necessary licenses from third parties for new technologies; our ability and the cost to comply with environmental regulations; legal and regulatory risks from our international operations; the fact that the healthcare industry is highly regulated and subject to various regulatory changes; and our business being indirectly subject to healthcare industry cost containment measures and third-party coverage and reimbursement policies that could result in reduced sales of our products; and
•other risks and uncertainties that arise from time to time.
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Unless otherwise noted, any forward-looking statement made by us in this Form 10-Q is based only on information currently available to us and speaks only as of the date on which it is made. Except as may be required by applicable law, we disclaim any obligation to update forward-looking statements in this Form 10-Q whether to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results, financial conditions or prospects, or otherwise.
In this Form 10-Q, references to “Integer,” “we,” “us,” “our” and the “Company” mean Integer Holdings Corporation and its subsidiaries, unless the context indicates otherwise.
The Merger
On August 2, 2026, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement,” and the transactions contemplated thereby, the “Transaction”), by and among the Company, Armstrong Parent, Inc., a Delaware corporation (“Parent”), and Armstrong Bidco, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”). Parent and Merger Sub are each affiliates of investment funds managed by Kohlberg Kravis Roberts & Co. L.P., a leading global investment firm. Pursuant to the Merger Agreement, and upon the terms and subject to the conditions therein, Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned subsidiary of Parent. If the Merger is consummated, the Company’s securities will be delisted from NYSE as soon as practicable following the Effective Time (defined below), and the Company will become a privately held company.
Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger (the “Effective Time”), each share of common stock of the Company, par value $0.001 per share (the “Company Common Shares”) issued and outstanding immediately prior to the Effective Time (other than Company Common Shares (i) held by the Company as a treasury share or owned by Parent, Merger Sub or any other Subsidiary of Parent immediately prior to the Effective Time, (ii) held by any subsidiary of the Company immediately prior to the Effective Time and (iii) held by any person who is entitled to demand, and has properly demanded, appraisal in respect of such Company Common Shares pursuant to applicable law), will automatically be converted into the right to receive $127 in cash, without interest (the “Merger Consideration”).
Outstanding equity awards will generally be treated as follows: (i) vested restricted stock unit (“RSU”) awards and 50% of unvested RSU awards will be canceled in exchange for a cash amount based on the Merger Consideration, and 50% of unvested RSUs will be converted into a deferred cash award based on the Merger Consideration that vests based on the original RSU award’s vesting conditions (with certain termination vesting protections); (ii) performance stock unit (“PSU”) awards for which the performance period is completed but that has not yet been settled will be canceled in exchange for a cash amount equal to the Merger Consideration based on actual performance, and PSU awards with open performance periods will be converted into a cash amount based on the Merger Consideration assuming the greater of target and actual performance, with 50% of such amount being paid as soon as practicable (assessed on a tranche-by-tranche basis) and the remaining 50% of such amount being paid subject to satisfaction of the original PSU award’s service vesting conditions (with certain termination vesting protections and without regard to any performance conditions); and (iii) stock options will be vested and canceled in exchange for a cash amount equal to the excess (if any) of the Merger Consideration over the applicable exercise price.
The consummation of the Merger is subject to certain customary closing conditions set forth in the Merger Agreement, including: (i) the approval and adoption of the Merger Agreement by the holders of a majority of the outstanding Company Common Shares (the “Company Stockholder Approval”); (ii) the absence of any order issued by any governmental authority (whether temporary, preliminary or permanent) of competent jurisdiction, or applicable law prohibiting, rendering illegal or enjoining the consummation of the Merger; (iii) the expiration or termination of any waiting periods applicable to the consummation of the Merger under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and certain other applicable antitrust and foreign direct investment laws of certain jurisdictions; (iv) each party’s performance of and compliance with its covenants, obligations and agreements contained in the Merger Agreement in all material respects; (v) no Company Material Adverse Effect (as defined in the Merger Agreement) having occurred since the date of the Merger Agreement and (vi) the accuracy of the representations and warranties of the parties in the Merger Agreement (subject to customary materiality qualifiers). The Merger is not subject to any financing condition, and Parent and Merger Sub have obtained equity and debt financing commitments for the Transaction.
Subject to certain exceptions, the Company has agreed not to solicit alternative acquisition proposals, engage in discussions with any third party regarding alternative acquisition proposals or change its recommendation to its stockholders in favor of the Merger.
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The Merger Agreement contains certain customary termination rights for each of the Company and Parent, including, (i) by mutual written agreement of the Company and Parent, (ii) if the Merger has not been consummated on or before May 2, 2027 (the “Outside Date”), (iii) any applicable order, writ, injunction, judgment or decree of any governmental authority (an “Order”) issued by any governmental authority of competent jurisdiction rendering illegal, or restraining, enjoining or otherwise prohibiting the consummation of the Merger and such Order has become final and nonappealable, (iv) the Company Stockholder Approval shall not have been obtained at a meeting of holders of the Company Common Shares (the “Company Stockholders Meeting”) or (v) the other party is in breach of any representation or warranty or failure to perform any covenant or agreement on the part of the respective parties in a manner that would result in a failure of an applicable closing condition and such breach cannot be cured or, if curable, has not been cured within 20 business days after notice to the other party of such breach (or, if earlier, five business days prior to the Outside Date).
In addition, prior to receipt of the Company Stockholder Approval, (i) the Company may also terminate the Merger Agreement to (A) accept a Superior Proposal, subject to Parent’s right to match such Superior Proposal and payment to Parent of the Company Termination Fee (as described below), or (B) in circumstances relating to Parent’s breach of the Merger Agreement or failure to consummate the Merger when it is required to do so under the Merger Agreement, subject to payment to the Company of the Parent Termination Fee (as defined below) and (ii) Parent may terminate the Merger Agreement if the Board of Directors changes its recommendation to the Company’s stockholders regarding the Merger Agreement (an “Adverse Recommendation Change”).
The Merger Agreement provides for the payment of termination fees upon termination of the Merger Agreement under certain specified circumstances. The Company will be obligated to pay Parent a termination fee of $154 million (the “Company Termination Fee”) if the Merger Agreement is terminated (i) by the Company to accept a Superior Proposal, (ii) by Parent following an Adverse Recommendation Change, or (iii) in certain circumstances by either Parent or the Company and prior to such termination a bona fide acquisition proposal is publicly announced or publicly disclosed and not publicly withdrawn or otherwise abandoned at least five business days prior to such termination of the Merger Agreement or the date of the Company Stockholders Meeting and the Company enters into a definitive agreement for, or consummates, a transaction involving a Superior Proposal within twelve months of such termination.
Parent will be obligated to pay the Company a termination fee of $307 million (the “Parent Termination Fee”) if the Merger Agreement is terminated by the Company in certain circumstances relating to Parent’s breach of the Merger Agreement or failure to consummate the Merger when it is required to do so under the Merger Agreement.
Our Business
Integer Holdings Corporation is one of the largest medical device contract development and manufacturing organizations in the world, serving the cardio and vascular, neuromodulation, and cardiac rhythm management markets. As a strategic partner of choice, we advance the goals of our medical device customers through industry-leading engineering and manufacturing, with a relentless commitment to quality, service, and innovation.
We operate our business in one segment and derive our revenues from three product lines: Cardio & Vascular, Cardiac Rhythm Management & Neuromodulation and Other Markets.
The second quarter and first six months of 2026 ended on July 3 and consisted of 91 days and 184 days, respectively. The second quarter and first six months of 2025 ended on June 27 and consisted of 91 days and 178 days, respectively.
Impact of Global Events
Our future results of operations and liquidity could be materially adversely affected by uncertainty surrounding macroeconomic and geopolitical factors in the U.S. and globally characterized by the supply chain environment, inflationary pressure, changes in interest rates, disruptions in the commodities’ markets or in supply chain as a result of wars in Ukraine and the Middle East, the tensions in Asia relating to China and Taiwan, and the introduction of or changes in tariffs or trade barriers. The impact of these issues on our business will vary by geographic market and product line, but specific impacts to our business may include increased borrowing costs, labor shortages, disruptions in the supply chain, delayed or reduced customer orders and sales, delays in shipments to and from certain countries and potential increased expenses resulting from tariffs or other trade barriers.
We monitor economic conditions closely. In response to reductions in revenue, we can take actions to align our cost structure with changes in demand and manage our working capital. However, there can be no assurance as to the effectiveness of our efforts to mitigate any impact of the current and future adverse economic conditions and other developments.
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Sales Outlook
In 2026, we expect year over year sales growth to be primarily impacted by lower sales related to three new products due to lower than anticipated market adoption. We believe the magnitude of these changes on multiple products at the same time is highly unusual.
Business Acquisitions
We selectively evaluate acquisitions as a means to acquire additional technology or manufacturing capabilities to expand our product offering in our key existing growth markets. Consistent with our tuck-in acquisition strategy, since the beginning of 2022 we have completed the following acquisitions, including those that impact the comparability of our results between periods:
On December 4, 2025, we acquired certain assets of Biocoat. Prior to the acquisition, Biocoat was a privately-held manufacturer specializing in high value surface coating technology platforms, including UV and thermal cure hydrophilic coatings.
On February 28, 2025, we acquired substantially all of the assets and assumed certain liabilities of VSi. Prior to the acquisition, VSi was a privately-held full-service provider of parylene coating solutions, primarily focused on complex medical device applications.
On January 7, 2025, we acquired substantially all of the assets and assumed certain liabilities of Precision. Prior to the acquisition, Precision was a privately-held manufacturer specializing in high value surface coating technology platforms, including fluoropolymer, anodic coatings, ion treatment solutions and laser processing.
Refer to Note 2, “Business Acquisitions” of the Notes to Condensed Consolidated Financial Statements contained in Item 1 of this report for additional information about the transactions above.
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Financial Overview
Income from continuing operations for the second quarter and first six months of 2026 was $23.6 million, or $0.69 per diluted share, and $40.1 million, or $1.17 per diluted share, respectively, compared to $37.0 million, or $1.04 per diluted share, and $14.5 million, or $0.41 per diluted share for the second quarter and first six months of 2025, respectively. These variances are primarily the result of the following:
•Sales for the second quarter and first six months of 2026 decreased $12.4 million and $10.2 million, respectively, when compared to the same periods in 2025, driven by lower Cardio & Vascular and Other Markets sales, partially offset by higher Cardiac Rhythm Management & Neuromodulation sales. Sales for the second quarter and first six months of 2026 were impacted by lower sales related to lower than anticipated market adoption of three new products.
•Gross profit for the second quarter and first six months of 2026 decreased $16.2 million and $26.9 million, respectively, primarily driven by lower fixed cost absorption due to lower production volumes.
•Operating expenses for the second quarter and first six months of 2026 increased $8.6 million and $15.6 million, respectively, when compared to the same periods in 2025, primarily due to higher SG&A expenses and Restructuring and other charges. Operating expenses as a percentage of sales were 16.9% and 14.7% for the second quarters of 2026 and 2025, respectively, and 17.3% and 15.4% for the first six months of 2026 and 2025, respectively.
•Interest expense for the second quarter of 2026 increased $0.4 million compared to the same period in 2025 due to higher average debt balance outstanding, partially offset by lower losses from extinguishment of debt. Interest expense for the first six months of 2026 decreased $4.7 million compared to the same period in 2025, due to lower interest rates on our outstanding borrowings and lower losses from extinguishment of debt, partially offset by higher average debt balance outstanding.
•During the first six months of 2026 we recognized net losses from our equity investments of $1.4 million, compared to net gains of $0.2 million for the first six months of 2025. (Gain) loss on equity investments for the second quarter of 2026 and 2025 were not material. Gains and losses on equity investments are generally unpredictable in nature.
•Other loss, net for the second quarter and first six months of 2026 were net losses of $1.1 million and $1.5 million, respectively, compared to net losses of $4.0 million and $51.9 million, respectively, for the second quarter and first six months of 2025. Other loss, net for 2025 includes $46.7 million of debt conversion inducement expense, which was recognized in the first quarter of 2025, related to the partial exchange of our outstanding 2028 Notes.
•We recorded an income tax benefit for the second quarter and provision for income taxes for the first six months of 2026 of $0.3 million and $3.5 million, respectively, compared with provisions for income taxes of $8.6 million and $18.1 million, respectively, for the second quarter and first six months of 2025. The changes in income tax expense were primarily due to relative changes in pre-tax income and the impact of discrete tax items.
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Our Financial Results
The following table presents selected financial information derived from our Condensed Consolidated Financial Statements, contained in Item 1 of this report, for the periods presented (dollars in thousands, except per share).
| Three Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Sales | $ | 464,110 | $ | 476,494 | $ | (12,384) | (2.6) | % | |||||||||||||||
| Cost of sales | 351,168 | 347,342 | 3,826 | 1.1 | % | ||||||||||||||||||
| Gross profit | 112,942 | 129,152 | (16,210) | (12.6) | % | ||||||||||||||||||
| Gross profit as a % of sales | 24.3 | % | 27.1 | % | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Selling, general and administrative (“SG&A”) | 57,699 | 52,923 | 4,776 | 9.0 | % | ||||||||||||||||||
| SG&A as a % of sales | 12.4 | % | 11.1 | % | |||||||||||||||||||
| Research, development and engineering (“RD&E”) | 11,278 | 14,240 | (2,962) | (20.8) | % | ||||||||||||||||||
| RD&E as a % of sales | 2.4 | % | 3.0 | % | |||||||||||||||||||
| Restructuring and other charges | 9,437 | 2,651 | 6,786 | 256.0 | % | ||||||||||||||||||
| Total operating expenses | 78,414 | 69,814 | 8,600 | 12.3 | % | ||||||||||||||||||
| Operating income | 34,528 | 59,338 | (24,810) | (41.8) | % | ||||||||||||||||||
| Operating expense as a % of sales | 16.9 | % | 14.7 | % | |||||||||||||||||||
| Operating income as a % of sales (“Operating margin”) | 7.4 | % | 12.5 | % | |||||||||||||||||||
| Interest expense | 10,135 | 9,754 | 381 | 3.9 | % | ||||||||||||||||||
| (Gain) loss on equity investments | (42) | 8 | (50) | NM | |||||||||||||||||||
| Other loss, net | 1,144 | 3,980 | (2,836) | (71.3) | % | ||||||||||||||||||
| Income from continuing operations before taxes | 23,291 | 45,596 | (22,305) | (48.9) | % | ||||||||||||||||||
| Provision (benefit) for income taxes | (314) | 8,587 | (8,901) | (103.7) | % | ||||||||||||||||||
| Effective tax rate | (1.3) | % | 18.8 | % | |||||||||||||||||||
| Income from continuing operations | $ | 23,605 | $ | 37,009 | $ | (13,404) | (36.2) | % | |||||||||||||||
| Income from continuing operations as a % of sales | 5.1 | % | 7.8 | % | |||||||||||||||||||
| Diluted earnings per share from continuing operations | $ | 0.69 | $ | 1.04 | $ | (0.35) | (33.7) | % | |||||||||||||||
NM - Calculated change not meaningful.
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| Six Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Sales | $ | 903,690 | $ | 913,886 | $ | (10,196) | (1.1) | % | |||||||||||||||
| Cost of sales | 681,153 | 664,416 | 16,737 | 2.5 | % | ||||||||||||||||||
| Gross profit | 222,537 | 249,470 | (26,933) | (10.8) | % | ||||||||||||||||||
| Gross profit as a % of sales | 24.6 | % | 27.3 | % | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| SG&A | 116,410 | 104,083 | 12,327 | 11.8 | % | ||||||||||||||||||
| SG&A as a % of sales | 12.9 | % | 11.4 | % | |||||||||||||||||||
| RD&E | 27,521 | 28,441 | (920) | (3.2) | % | ||||||||||||||||||
| RD&E as a % of sales | 3.0 | % | 3.1 | % | |||||||||||||||||||
| Restructuring and other charges | 12,209 | 8,056 | 4,153 | 51.6 | % | ||||||||||||||||||
| Total operating expenses | 156,140 | 140,580 | 15,560 | 11.1 | % | ||||||||||||||||||
| Operating income | 66,397 | 108,890 | (42,493) | (39.0) | % | ||||||||||||||||||
| Operating expense as a % of sales | 17.3 | % | 15.4 | % | |||||||||||||||||||
| Operating income as a % of sales | 7.3 | % | 11.9 | % | |||||||||||||||||||
| Interest expense | 19,869 | 24,559 | (4,690) | (19.1) | % | ||||||||||||||||||
| Gain on equity investments | 1,426 | (173) | 1,599 | NM | |||||||||||||||||||
| Other loss, net | 1,460 | 51,907 | (50,447) | (97.2) | % | ||||||||||||||||||
| Income from continuing operations before taxes | 43,642 | 32,597 | 11,045 | 33.9 | % | ||||||||||||||||||
| Provision for income taxes | 3,531 | 18,053 | (14,522) | (80.4) | % | ||||||||||||||||||
| Effective tax rate | 8.1 | % | 55.4 | % | |||||||||||||||||||
| Income from continuing operations | $ | 40,111 | $ | 14,544 | $ | 25,567 | 175.8 | % | |||||||||||||||
| Income from continuing operations as a % of sales | 4.4 | % | 1.6 | % | |||||||||||||||||||
| Diluted earnings per share from continuing operations | $ | 1.17 | $ | 0.41 | $ | 0.76 | 185.4 | % | |||||||||||||||
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Product Line Sales
Sales by product lines were as follows (in thousands):
| Three Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Cardio & Vascular | $ | 280,308 | $ | 286,855 | $ | (6,547) | (2.3) | % | |||||||||||||||
Cardiac Rhythm Management & Neuromodulation | 173,712 | 171,998 | 1,714 | 1.0 | |||||||||||||||||||
| Other Markets | 10,090 | 17,641 | (7,551) | (42.8) | |||||||||||||||||||
| Total sales | $ | 464,110 | 464110 | $ | 476,494 | $ | (12,384) | (2.6) | |||||||||||||||
| Six Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Cardio & Vascular | $ | 542,041 | $ | 545,726 | $ | (3,685) | (0.7) | % | |||||||||||||||
| Cardiac Rhythm Management & Neuromodulation | 341,976 | 332,343 | 9,633 | 2.9 | |||||||||||||||||||
| Other Markets | 19,673 | 35,817 | (16,144) | (45.1) | |||||||||||||||||||
| Total sales | $ | 903,690 | 903690 | $ | 913,886 | $ | (10,196) | (1.1) | |||||||||||||||
For the second quarter and first six months of 2026, Cardio & Vascular (“C&V”) sales decreased $6.5 million, or (2)%, and $3.7 million, or (1)%, respectively, versus the comparable 2025 periods. Our 2025 acquisitions increased C&V sales for the second quarter and first six months of 2026 by $0.2 million and $2.9 million, in comparison to the corresponding periods in 2025. C&V sales for the second quarter and first six months of 2026 were also impacted by lower sales of two new Electrophysiology products due to lower than anticipated market adoption. Foreign currency exchange rate fluctuations increased C&V sales for the second quarter and first six months of 2026 by $0.3 million and $1.6 million, in comparison to the corresponding periods in 2025, primarily due to U.S. dollar fluctuations relative to the Euro.
For the second quarter and first six months of 2026, Cardiac Rhythm Management & Neuromodulation (“CRM&N”) sales increased $1.7 million, or 1%, and $9.6 million, or 3%, respectively, versus the comparable 2025 periods. Growth was partially offset by lower sales of a Neuromodulation product due to lower than anticipated market adoption. Foreign currency exchange rate fluctuations did not have a material impact on CRM&N sales during the second quarter of 2026 in comparison to the corresponding period in 2025.
Other Markets sales for the second quarter and first six months of 2026 decreased $7.6 million, or 43%, and $16.1 million or 45%, respectively, versus the comparable 2025 periods, primarily due to the Portable Medical Exit. Foreign currency exchange rate fluctuations did not have a material impact on Other Markets sales during the second quarter and first six months of 2026 in comparison to the corresponding periods in 2025.
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Gross Profit
| Three Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Gross profit (in thousands) | $ | 112,942 | $ | 129,152 | $ | (16,210) | (12.6) | % | |||||||||||||||
| Gross margin | 24.3 | % | 27.1 | % | |||||||||||||||||||
| Six Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Gross profit (in thousands) | $ | 222,537 | $ | 249,470 | $ | (26,933) | (10.8) | % | |||||||||||||||
| Gross margin | 24.6 | % | 27.3 | % | |||||||||||||||||||
Gross margin declined in the second quarter and first six months of 2026 compared to the same prior year period due to the negative impact of lower fixed cost absorption, partly offset by on-going cost reduction initiatives. Gross margin, or gross profit as a percentage of sales, has been and will continue to be affected by a variety of factors, including the average sales price of our products and services and transaction volume growth. We expect our gross margin to fluctuate over time.
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SG&A Expenses
Changes to SG&A expenses from the prior year periods were due to the following (in thousands):
| Three Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Compensation and benefits | $ | 27,221 | $ | 27,851 | $ | (630) | (2.3) | % | |||||||||||||||
| Depreciation and amortization expense | 12,841 | 12,709 | 132 | 1.0 | |||||||||||||||||||
Professional fees(a) | 9,093 | 4,460 | 4,633 | 103.9 | |||||||||||||||||||
Contract services(b) | 4,837 | 4,088 | 749 | 18.3 | |||||||||||||||||||
| Travel and entertainment | 792 | 806 | (14) | (1.7) | |||||||||||||||||||
| Bank fees and charges | 648 | 913 | (265) | (29.0) | |||||||||||||||||||
| All other SG&A | 2,267 | 2,096 | 171 | 8.2 | |||||||||||||||||||
| Total SG&A expense | $ | 57,699 | $ | 52,923 | $ | 4,776 | 9.0 | ||||||||||||||||
| Six Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Compensation and benefits | $ | 56,253 | $ | 55,414 | $ | 839 | 1.5 | % | |||||||||||||||
| Depreciation and amortization expense | 25,703 | 24,485 | 1,218 | 5.0 | |||||||||||||||||||
Professional fees(a) | 16,714 | 7,800 | 8,914 | 114.3 | |||||||||||||||||||
Contract services(b) | 9,837 | 8,067 | 1,770 | 21.9 | |||||||||||||||||||
| Travel and entertainment | 1,229 | 1,981 | (752) | (38.0) | |||||||||||||||||||
| Bank fees and charges | 1,479 | 1,745 | (266) | (15.2) | |||||||||||||||||||
| All other SG&A | 5,195 | 4,591 | 604 | 13.2 | |||||||||||||||||||
| Total SG&A expense | $ | 116,410 | $ | 104,083 | $ | 12,327 | 11.8 | ||||||||||||||||
__________
(a)Professional fees for the second quarter and first six months of 2026 were impacted by legal and advisory fees related to a stockholder activist matter and defense of a securities class action lawsuit. The activist related costs amounted to $0.6 and $3.8 million for the second quarter and first six months of 2026. In addition, we recorded $1.8 million during the second quarter of 2026 in connection with our defense of a securities class action lawsuit. For additional information regarding legal proceedings pending against us, refer to Note 10, “Commitments and Contingencies,” of the Notes to Condensed Consolidated Financial Statements contained in Item 1 of this report.
(b)Contract services expense increased primarily due to higher software costs from information technology enhancements.
RD&E
RD&E expense for the second quarter and first six months of 2026 was $11.3 million and $27.5 million, respectively, compared to $14.2 million and $28.4 million, respectively, for the second quarter and first six months of 2025. The decreases in RD&E expense during the second quarter and first six months of 2026 compared to the same period in 2025, was primarily due to the timing of program milestone achievements for customer funded programs. RD&E expenses are influenced by the number and timing of in-process projects and labor hours and other costs associated with these projects. Our research and development initiatives continue to emphasize new product development, product improvements, and the development of new technological platform innovations.
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Restructuring and Other Charges
We continuously evaluate our business and identify opportunities to realign resources to better serve our customers and markets, improve operational efficiency and capabilities, and lower operating costs. To realize the benefits associated with these opportunities, we undertake restructuring-type activities to transform our business. We incur costs associated with these activities, which primarily include exit and disposal costs and other costs directly related to the restructuring initiative. Restructuring charges include exit and disposal costs from these activities. In addition, from time to time, we incur costs associated with acquiring and integrating businesses, and certain other general expenses, including asset impairments.
Restructuring and other charges comprise the following (in thousands):
| Three Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
Restructuring charges(a) | $ | 1,841 | $ | 637 | $ | 1,204 | 189.0 | % | |||||||||||||||
Acquisition and integration costs(b) | 173 | 2,007 | (1,834) | (91.4) | |||||||||||||||||||
Other general expenses(c) | 7,423 | 7 | 7,416 | NM | |||||||||||||||||||
| Total restructuring and other charges | $ | 9,437 | $ | 2,651 | $ | 6,786 | 256.0 | ||||||||||||||||
| Six Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
Restructuring charges(a) | $ | 2,448 | $ | 1,301 | $ | 1,147 | 88.2 | % | |||||||||||||||
Acquisition and integration costs(b) | 1,615 | 6,749 | (5,134) | (76.1) | |||||||||||||||||||
Other general expenses(c) | 8,146 | 6 | 8,140 | NM | |||||||||||||||||||
| Total restructuring and other charges | $ | 12,209 | $ | 8,056 | $ | 4,153 | 51.6 | ||||||||||||||||
__________
(a)Restructuring charges for the second quarter and first six months of 2026 and 2025 primarily consist of costs associated with our strategic reorganization and alignment and manufacturing alignment to support growth initiatives.
(b)Amounts for the second quarter and first six months of 2026 primarily include integration expenses related to our recent acquisitions and $0.7 million of costs recorded during the first quarter of 2026 related to our investment in a convertible debt instrument. These expenses were partially offset by a benefit of $1.2 million recorded during the second quarter of 2026 to adjust the fair value of acquisition-related contingent consideration liabilities. Amounts for the second quarter and first six months of 2025 primarily include acquisition expenses related to the Precision and VSi acquisitions.
(c)Amounts include gains and losses in connection with the disposal of property, plant and equipment. Amount for the second quarter and first six months of 2026 include fixed asset impairment charges of $5.9 million. The impairment charges were primarily due to revised expectations regarding the future use of certain fixed assets.
Refer to Note 8, “Restructuring and Other Charges” of the Notes to Condensed Consolidated Financial Statements contained in Item 1 of this report for additional information regarding these initiatives.
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Interest Expense
Information relating to our interest expense is as follows (dollars in thousands):
| Three Months Ended | |||||||||||||||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | Change | |||||||||||||||||||||||||||||||||
| Amount | Rate | Amount | Rate | Amount | Rate (bp) | ||||||||||||||||||||||||||||||
| Contractual interest expense | $ | 7,650 | 2.40 | % | $ | 7,632 | 2.41 | % | $ | 18 | (1) | ||||||||||||||||||||||||
| Amortization of deferred debt issuance costs and original issue discount | 1,638 | 0.52 | 1,615 | 0.55 | 23 | (3) | |||||||||||||||||||||||||||||
Losses from extinguishment of debt | — | — | 130 | 0.04 | (130) | (4) | |||||||||||||||||||||||||||||
| Interest expense on borrowings | 9,288 | 2.92 | % | 9,377 | 3.00 | % | (89) | (8) | |||||||||||||||||||||||||||
| Other interest expense | 847 | 377 | 470 | ||||||||||||||||||||||||||||||||
| Total interest expense | $ | 10,135 | $ | 9,754 | $ | 381 | |||||||||||||||||||||||||||||
| Six Months Ended | |||||||||||||||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | Change | |||||||||||||||||||||||||||||||||
| Amount | Rate | Amount | Rate | Amount | Rate (bp) | ||||||||||||||||||||||||||||||
| Contractual interest expense | $ | 15,042 | 2.40 | % | $ | 20,117 | 3.22 | % | $ | (5,075) | (82) | ||||||||||||||||||||||||
| Amortization of deferred debt issuance costs and original issue discount | 3,263 | 0.52 | 2,760 | 0.49 | 503 | 3 | |||||||||||||||||||||||||||||
Losses from extinguishment of debt | — | — | 867 | 0.14 | (867) | (14) | |||||||||||||||||||||||||||||
| Interest expense on borrowings | 18,305 | 2.92 | % | 23,744 | 3.85 | % | (5,439) | (93) | |||||||||||||||||||||||||||
| Other interest expense | 1,564 | 815 | 749 | ||||||||||||||||||||||||||||||||
| Total interest expense | $ | 19,869 | $ | 24,559 | $ | (4,690) | |||||||||||||||||||||||||||||
Contractual interest expense for the second quarter of 2026 has leveled off, with a slight increase in the quarter compared to the same period in 2025. During the first six months of 2026, contractual interest expense decreased due to a lower weighted average interest rate, partially offset by a higher average debt balance outstanding. The favorable weighted average interest rate is due to the replacement of some of our higher variable rate debt with lower fixed rate debt through issuance of the 2030 Notes at the end of the first quarter of 2025. The higher average debt balance outstanding is primarily the result of borrowings to fund the 2025 acquisitions and to repurchase common stock.
Other components of interest expense on borrowings include non-cash amortization and write-off (losses from extinguishment of debt) of deferred debt issuance costs and original issue discount. Amortization of deferred debt issuance costs and original issue discount increased during the second quarter and first six months of 2026 compared to the same periods in 2025 as a result of higher unamortized balances related to new debt. The losses from extinguishment of debt during the first quarter of 2025 were related to prepayments of portions of the TLA Facility, primarily in connection with issuance of our 2030 Notes.
As of July 3, 2026 and December 31, 2025, approximately 89% and 92%, respectively, of our principal amount of debt are fixed rate borrowings.
See Note 6, “Debt,” of the Notes to the Condensed Consolidated Financial Statements contained in Item 1 of this report for additional information pertaining to our debt.
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(Gain) Loss on Equity Investments
(Gain) loss on equity investments for each period were as follows (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| July 3, 2026 | June 27, 2025 | July 3, 2026 | June 27, 2025 | ||||||||||||||||||||
| Equity method investment (gain) loss | $ | (42) | $ | 8 | $ | 1,426 | $ | (173) | |||||||||||||||
Equity method investment (gain) loss for both 2026 and 2025 relates to our share of equity method investee gains including unrealized appreciation/depreciation of the underlying interests of the investee. As of July 3, 2026 and December 31, 2025, the carrying value of our equity investments was $6.4 million and $7.9 million, respectively.
See Note 13, “Financial Instruments and Fair Value Measurements” of the Notes to the Condensed Consolidated Financial Statements contained in Item 1 of this report for further details regarding these investments.
Other Loss, Net
| Three Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
Foreign currency transaction losses, net(a) | $ | 999 | $ | 3,866 | $ | (2,867) | (74) | % | |||||||||||||||
| Other losses, net | 145 | 114 | 31 | 27 | % | ||||||||||||||||||
| $ | 1,144 | $ | 3,980 | $ | (2,836) | (71) | % | ||||||||||||||||
| Six Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
Foreign currency transaction losses, net(a) | $ | 1,375 | $ | 5,010 | $ | (3,635) | (73) | % | |||||||||||||||
Debt conversion inducement expense(b) | — | 46,681 | (46,681) | NM | |||||||||||||||||||
| Other losses, net | 85 | 216 | (131) | (61) | % | ||||||||||||||||||
| $ | 1,460 | $ | 51,907 | $ | (50,447) | (97) | % | ||||||||||||||||
__________
(a)Represents gains/losses from the impact of exchange rates on transactions denominated in foreign currencies. Our foreign currency transaction gains/losses are based primarily on fluctuations of the U.S. dollar relative to the Euro, Mexican peso, Uruguayan peso, Malaysian ringgits, or Dominican peso.
(b)Debt conversion inducement expense was recognized in the first quarter of 2025 related to the partial exchange of our outstanding 2028 Notes.
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Provision for Income Taxes
| Three Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Income from continuing operations before taxes | $ | 23,291 | $ | 45,596 | $ | (22,305) | (49) | % | |||||||||||||||
| Provision (benefit) for income taxes | (314) | 8,587 | (8,901) | (104) | % | ||||||||||||||||||
| Effective tax rate | (1.3) | % | 18.8 | % | |||||||||||||||||||
| Six Months Ended | |||||||||||||||||||||||
| July 3, | June 27, | Change | |||||||||||||||||||||
| 2026 | 2025 | $ | % | ||||||||||||||||||||
| Income from continuing operations before taxes | $ | 43,642 | $ | 32,597 | $ | 11,045 | 34 | % | |||||||||||||||
| Provision for income taxes | 3,531 | 18,053 | (14,522) | (80) | % | ||||||||||||||||||
| Effective tax rate | 8.1 | % | 55.4 | % | |||||||||||||||||||
The decrease in the tax provision was primarily due to an increase in R&D tax credits, a favorable provision to return adjustment, and the impact of the non-recurring 2025 expense associated with the net nondeductible induced conversion expenditures incurred as a result of the induced conversion from the exchange of the 2028 Convertible Notes, partially offset by shortfalls recognized upon the vesting of RSUs.
Our effective tax rate for 2026 differs from the U.S. federal statutory tax rate of 21% due principally to the estimated impact of Federal Tax Credits (including R&D credits and foreign tax credits), and the application of U.S. and foreign international tax rules related to the taxation of global earnings, including Net CFC tested income (“NCTI”), formerly referred to as global intangible low‑tax income (“GILTI”), the deduction associated with foreign‑derived deduction‑eligible income (“FDDEI”), formerly known as foreign‑derived intangible income (“FDII”), and the impact of the OECD’s Pillar Two global minimum tax framework.
NCTI represents income earned by the Company’s controlled foreign corporations that is subject to current U.S. federal income taxation, after consideration of applicable foreign tax credits. NCTI is treated as a period cost and included in the Company’s income tax provision in the period in which the related foreign earnings arise. The amount of NCTI recognized is influenced by the level and mix of foreign earnings, foreign effective tax rates, and the availability of foreign tax credits.
FDDEI provides a deduction that reduces U.S. taxable income generated from certain qualifying foreign sales and services. The benefit recognized from FDDEI depends on the level of qualifying income, overall U.S. taxable income, and statutory limitations.
In addition, our rate is impacted by earnings realized in foreign jurisdictions with statutory rates that are different than the U.S. federal statutory rate. The primary foreign jurisdictions in which we operate and the statutory tax rate for each respective jurisdiction include Ireland (12.5%), Malaysia (24%), Mexico (30%), Switzerland (22%) and Uruguay (25%). Our manufacturing operations in Costa Rica and the Dominican Republic operate under a free trade zone agreement through April 2031 and March 2034, respectively.
In January 2026, the Organization for Economic Cooperation and Development (“OECD”) released administrative guidance recognizing the U.S. minimum tax regime and introducing a “side-by-side” package intended to exempt U.S. parented groups from Pillar 2 minimum taxes imposed by foreign jurisdictions on U.S. earnings. Although full adoption of the guidance is expected to eliminate this exposure with respect to the U.S. jurisdiction, laws to implement the framework have not been enacted in all relevant countries. Accordingly, our financial results reflect the laws enacted and in effect as of July 3, 2026.
Changes in the geographic mix of earnings, foreign income tax rates, the availability of tax credits and deductions, business acquisitions, settlements with taxing authorities, and the continued implementation and interpretation of international tax rules, including NCTI, FDDEI, and Pillar Two, may contribute to volatility in the Company’s effective tax rate in future periods. In addition, we continue to explore tax planning opportunities that may have a material impact on our effective tax rate.
Refer to Note 9, “Income Taxes,” to the accompanying Consolidated Condensed Financial Statements for discussion regarding the Company’s significant tax matters.
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Liquidity and Capital Resources
Sources of Liquidity
| (dollars in thousands) | July 3, 2026 | December 31, 2025 | |||||||||||||||
| Cash and cash equivalents | $ | 21,375 | $ | 17,161 | |||||||||||||
| Working capital from continuing operations | $ | 593,494 | $ | 538,056 | |||||||||||||
| Current ratio from continuing operations | 3.73 | 3.32 | |||||||||||||||
Cash and cash equivalents at July 3, 2026 increased by $4.2 million from December 31, 2025. Cash generated by operating activities of $84.4 million and proceeds from net borrowings on our revolving credit facility of $50.0 million were primarily offset by purchases of property, plant and equipment of $46.7 million, $50.0 million of repurchases of common stock, a $14.0 million investment in a convertible debt instrument, and tax withholding payments related to net share settlements of restricted stock unit awards of $10.3 million.
Working capital increased by $55.4 million from December 31, 2025, or $51.2 million excluding the increase in cash and cash equivalents. The increase in working capital, exclusive of cash and cash equivalents, primarily relates to positive fluctuations in inventory, contract assets and accrued expenses and other liabilities, which were partially offset by a decrease in accounts receivable from the favorable timing of customer payments.
At July 3, 2026, $7.8 million of our cash and cash equivalents were held by foreign subsidiaries. We intend to limit our distributions from foreign subsidiaries to previously taxed income or current period earnings. If distributions are made utilizing current period earnings, we will record foreign withholding taxes in the period of the distribution.
As of July 3, 2026, our capital structure consisted of $1,237.9 million of debt, net of deferred debt issuance costs and unamortized discounts and 34 million shares of common stock outstanding. As of July 3, 2026, we had access to $744.7 million of borrowing capacity under our Revolving Credit Facility, available for normal course of business and letters of credit, and are authorized to issue up to 100 million shares of common stock and 100 million shares of preferred stock. As of July 3, 2026, our contractual debt service obligations for the remainder of 2026, consisting of interest on our outstanding debt and commitment fees on the unused portion of the Revolving Credit Facility are estimated to be approximately $15 million. Actual principal and interest payments may be higher if, for instance, the applicable interest rates on our Senior Secured Credit Facilities increase, we borrow additional amounts on our Revolving Credit Facility, or we pay principal amounts in excess of the required minimums reflected in the contractual debt service obligations above.
Based on current expectations, we believe that our projected cash flows provided by operations, available cash and cash equivalents and borrowings under our Revolving Credit Facility are sufficient to meet our working capital, debt service and capital expenditure requirements for the next twelve months. If our future financing needs increase, we may need to arrange additional debt or equity financing. We continually evaluate and consider various financing alternatives to enhance or supplement our existing financial resources. However, we cannot be assured that we will be able to enter into any such arrangements on acceptable terms or at all. On August 2, 2026, we entered into the Merger Agreement. Subject to the terms and conditions of the Merger Agreement, at the Effective Time, each share of Company Common Shares outstanding immediately prior to the Effective Time, subject to certain limitations, will automatically be converted into the right to receive $127 in cash, without interest and thereafter the Company will be delisted from the NYSE. See The Merger above and Item 1A. Risk Factors, Risks Related to the Merger.
Credit Facilities and 2028 Notes
As of July 3, 2026, we had Senior Secured Credit Facilities that consist of an $800 million Revolving Credit Facility, with $50 million outstanding principal balance, and a TLA Facility with an outstanding principal balance of $91 million. The Revolving Credit Facility and TLA Facility mature on February 15, 2028. The Senior Secured Credit Facilities include a mandatory prepayment provision customary for similar credit facilities.
The Revolving Credit Facility and TLA Facility contain covenants requiring that we maintain (i) a Total Net Leverage Ratio not to exceed 5.00:1.00, subject to increase in certain circumstances following certain qualified acquisitions and (ii) an interest coverage ratio of at least 2.50:1.00. As of July 3, 2026, we were in compliance with these financial covenants. As of July 3, 2026, our Total Net Leverage Ratio, calculated in accordance with our Senior Secured Credit Facilities agreement, was approximately 2.9:1.0. For the twelve month period ended July 3, 2026, our interest coverage ratio, calculated in accordance with our Senior Secured Credit Facilities agreement, was approximately 14.0:1.0.
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Failure to comply with these financial covenants would result in an event of default as defined under the Revolving Credit Facility and TLA Facility unless waived by the lenders. An event of default may result in the acceleration of our indebtedness. As a result, management believes that compliance with these covenants is material to us.
Convertible Notes
In March 2025, we issued $1.0 billion aggregate principal amount of 2030 Convertible Notes, which mature on March 15, 2030 and bear interest at a fixed rate of 1.875% per annum. The total net proceeds from the issuance of the 2030 Convertible Notes, after deducting initial purchasers' discounts and commissions and debt issuance costs, were approximately $976 million. We used the net proceeds from the issuance of the 2030 Convertible Notes to pay down our Revolving Credit Facility and TLA Facility, exchange a portion of our 2028 Convertible Notes, and to pay the cost of the capped calls related to the issuance of our 2030 Convertible Notes.
In February 2023, we issued $500 million aggregate principal amount of notes. The 2028 Convertible Notes mature on February 15, 2028 and bear interest at a fixed rate of 2.125% per annum. In March 2025, in connection with the issuance of the 2030 Convertible Notes, the Company used part of the net proceeds therefrom to exchange $383.7 million in aggregate principal amount of the 2028 Convertible Notes in privately-negotiated transactions. As of July 3, 2026, the remaining aggregate principal amount of the 2028 Convertible Notes was $116.3 million.
As of July 3, 2026, the conditions allowing holders of the Convertible Notes to convert had not been met. Any determination regarding the convertibility of the Convertible Notes during future periods will be made in accordance with the terms of the indenture governing the Convertible Notes. These obligations are classified as a long-term liability on the Consolidated Balance Sheet at July 3, 2026.
See Note 6, “Debt” of the Notes to the Condensed Consolidated Financial Statements contained in Item 1 of this report for a further information on the Company’s outstanding debt.
Share Repurchase Program
On November 4, 2025, we announced that our Board of Directors had approved a share repurchase program authorizing us to repurchase up to an aggregate of $200.0 million of our outstanding common stock (the “Share Repurchase Program”). Under the Share Repurchase Program, we may repurchase shares from time to time on the open market, in privately-negotiated purchases or otherwise. The Share Repurchase Program has no expiration date and will continue until otherwise suspended or terminated. We are not obligated to repurchase any dollar amount or to acquire any specific number of shares and repurchases may be executed at the discretion of management on an opportunistic basis, or pursuant to trading plans or other arrangements. During 2025, we repurchased 698,356 shares of our common stock for a total of $50.0 million.
On February 19, 2026, we entered into an accelerated share repurchase agreement to repurchase $50.0 million of common stock under the Share Repurchase Program. Under the terms of the ASR Agreement, we paid Bank of America $50.0 million on February 19, 2026 and on that date received initial delivery of 462,535 shares of common stock. On April 2, 2026, Bank of America delivered 127,070 additional shares which completed the ASR Agreement totaling 589,605 repurchased shares. The Company used available cash and borrowings under our credit facility to fund the repurchase of the common shares under the ASR Agreement. As of July 3, 2026, the Company had $100 million of capacity remaining under the Share Repurchase Program.
Factoring Arrangements
We utilize accounts receivable factoring arrangements with financial institutions to accelerate the timing of cash receipts and enhance our cash position. These arrangements, in all cases, do not contain recourse provisions, which would obligate us in the event of our customers’ failure to pay. During the first six months of 2026 and 2025, we sold, without recourse, $25.1 million and $131.1 million of accounts receivable, respectively. See Note 3, “Supplemental Financial Statement Disclosures” of the Notes to the Condensed Consolidated Financial Statements contained in Item 1 of this report for further information regarding our factoring arrangements.
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Summary of Cash Flow
The following cash flow summary information includes cash flows related to discontinued operations.
| Six Months Ended | |||||||||||||||||
| (in thousands) | July 3, 2026 | June 27, 2025 | |||||||||||||||
| Cash provided by (used in): | |||||||||||||||||
| Operating activities | $ | 84,430 | $ | 75,138 | |||||||||||||
| Investing activities | (60,586) | (214,994) | |||||||||||||||
| Financing activities | (19,755) | 115,989 | |||||||||||||||
| Effect of foreign currency exchange rates on cash and cash equivalents | 125 | 459 | |||||||||||||||
| Net change in cash and cash equivalents | $ | 4,214 | $ | (23,408) | |||||||||||||
Operating Activities – During the first six months of 2026, we generated cash from operations of $84.4 million, compared to $75.1 million for the first six months of 2025, as an increase in cash flow provided by changes in operating assets and liabilities was partially offset by a $13.0 million decrease in net income adjusted for non-cash items such as depreciation and amortization.
Investing Activities – The $154.4 million decrease in net cash used in investing activities was primarily attributable to lower cash paid for acquisitions offset by the purchase of a long-term investment. Investing activities for the first six months of 2025 included net cash paid of $171.8 million for the Precision and VSi acquisitions.
Financing Activities – Net cash used in financing activities for the first six months of 2026 was $19.8 million compared to $116.0 million provided by financing activities for the first six months of 2025. In the first six months of 2026, cash payments of $50.0 million for repurchases of common stock and $10.3 million related to stock-based compensation activity were primarily offset by net proceeds of $50.0 million received from net borrowings under our revolving credit facility. Cash provided by financing activities for the first six months of 2025 was primarily the net proceeds from the issuance of our 2030 Convertible Notes of $977.5 million, which was partially offset by a $71.0 million purchase of capped call options associated with the 2030 Convertible Notes, $383.7 million in aggregate principal amount of exchanged 2028 Convertible Notes, $274.0 million of principal payments on our TLA Facility, $116.0 million net payments on our Revolving Credit Facility, and $13.1 million related to stock-based compensation activity.
Off-Balance Sheet Arrangements
We do not currently have off balance sheet arrangements that have or are reasonably likely to have a material current or future effect on our Condensed Consolidated Financial Statements.
Impact of Recently Issued Accounting Standards
In the normal course of business, we evaluate all new accounting pronouncements issued by the FASB, SEC, or other authoritative accounting bodies to determine the potential impact they may have on our Condensed Consolidated Financial Statements. See Note 1, “Basis of Presentation” of the Notes to Condensed Consolidated Financial Statements contained in Item 1 of this report for additional information about these recently issued accounting standards and their potential impact on our financial condition or results of operations.
Critical Accounting Policies and Estimates
The preparation of our Condensed Consolidated Financial Statements in accordance with accounting principles generally accepted in the U.S. requires management to make estimates, assumptions and judgments that affect the amounts reported in the financial statements and accompanying notes. Our estimates, assumptions and judgments are based on historical experience and various other assumptions believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying amount of assets and liabilities that are not readily apparent from other sources. Making estimates, assumptions and judgments about future events is inherently unpredictable and is subject to significant uncertainties, some of which are beyond our control. Management believes the estimates, assumptions and judgments employed and resulting balances reported in the Condensed Consolidated Financial Statements are reasonable; however, actual results could differ materially.
There have been no significant changes to the critical accounting policies and estimates as compared to those disclosed in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2025.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There have been no material changes to the Company’s exposure to market risk from the information provided in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
ITEM 4. CONTROLS AND PROCEDURES
a. Evaluation of Disclosure Controls and Procedures
Our management, including the principal executive officer and principal financial officer, evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) related to the recording, processing, summarization and reporting of information in our reports that we file with the Securities and Exchange Commission as of July 3, 2026. These disclosure controls and procedures have been designed to provide reasonable assurance that material information relating to us, including our subsidiaries, is made known to our management, including these officers, by our employees, and that this information is recorded, processed, summarized, evaluated and reported, as applicable, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Based on their evaluation, as of July 3, 2026, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures are effective at the reasonable assurance level.
b. Changes in Internal Control Over Financial Reporting
During the Company’s most recent fiscal quarter, there have been no changes in the Company’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
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PART II—OTHER INFORMATION
ITEM 1.LEGAL PROCEEDINGS
For information regarding certain legal proceedings pending against us, see Note 10, “Commitments and Contingencies,” of the Notes to Condensed Consolidated Financial Statements contained in Item 1, “Financial Statements,” of this report, which is incorporated herein by reference.
ITEM 1A.RISK FACTORS
Except as set forth below, there have been no material changes to the Company’s risk factors as previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
Risks Related to the Merger
The pending Merger may be delayed or not occur at all for a variety of reasons, including that the Merger is terminated, and the failure to complete the Transaction could adversely affect our business, results of operations, financial condition, and the market price of our common stock.
On August 2, 2026, we entered into the Merger Agreement. Under the terms of the Merger Agreement, the completion of the Merger is subject to certain customary closing conditions, including: (i) the approval and adoption of the Merger Agreement by the holders of a majority of the outstanding Company Common Shares; (ii) the absence of any order issued by any governmental authority (whether temporary, preliminary or permanent) of competent jurisdiction, or applicable law prohibiting, rendering illegal or enjoining the consummation of the Merger; (iii) the expiration or termination of any waiting periods applicable to the consummation of the Merger under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and certain other applicable antitrust and foreign direct investment laws of certain jurisdictions; (iv) each party’s performance of and compliance with its covenants, obligations and agreements contained in the Merger Agreement in all material respects; (v) no Company Material Adverse Effect (as defined in the Merger Agreement) having occurred since the date of the Merger Agreement and (vi) the accuracy of the representations and warranties of the parties in the Merger Agreement (subject to customary materiality qualifiers).
The Merger Agreement contains customary representations, warranties and covenants made by each of the Company, Parent and Merger Sub, including, among others, covenants by the Company regarding the conduct of its business during the pendency of the transactions contemplated by the Merger Agreement, public disclosures and other matters.
Both the Company and Parent may terminate the Merger Agreement under certain specified circumstances, including, among others, (i) if the Merger is not consummated by May 2, 2027, (ii) in the case of Parent, if the Company materially breaches its covenants not to solicit alternative business combination transactions or the Company’s Board of Directors effects a change of recommendation with respect to the proposed transaction or (iii) in the case of the Company, in order to enter into a definitive agreement with respect to a “superior proposal” subject to certain requirements. In certain circumstances in connection with the termination of the Merger Agreement, including if the Company materially breaches its covenants not to solicit alternative business combination transactions, the Company’s Board of Directors effects a change of recommendation, or the Company terminates the Merger Agreement to enter into a definitive agreement with respect to a “superior proposal,” the Company would be required to pay Parent a termination fee of $154 million.
Failure to complete the Merger within the expected timeframe or at all could adversely affect our business and the market price of our common stock in a number of ways, including:
•the market price of our common stock may decline to the extent that the current market price reflects an assumption that the Merger will be consummated; and
•we have incurred, and will continue to incur, significant expenses for professional services in connection with the Merger for which we will have received little or no benefit if the Merger is not consummated.
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Efforts to complete the Merger could disrupt our relationships with third parties and employees, divert management’s attention, or result in negative publicity or legal proceedings, any of which could negatively impact our operating results and ongoing business.
We have expended, and will continue to expend, significant management time and resources in an effort to complete the Merger, which may have a negative impact on our ongoing business and operations. Uncertainty regarding the outcome of the Merger and our future could disrupt our business relationships with our existing and potential customers, suppliers, service providers and other business partners, who may be more cautious in their arrangements with us or attempt to negotiate changes in existing business relationships or consider entering into business relationships with parties other than us. Our employees may have concerns with respect to the Merger and uncertainty regarding the outcome of the Merger could also adversely affect our ability to recruit and retain key personnel and other employees. Pending or future litigation against us and our directors and officers relating to the Merger may be distracting to management and, in the future, may require us to incur significant costs. Such litigation could result in the Merger being delayed and/or enjoined by a court of competent jurisdiction, which could prevent the Merger from being completed. The occurrence of any of these events individually or in combination could have a material and adverse effect on our business, financial condition and results of operations.
While the Merger Agreement is in effect, we are subject to restrictions on our business activities.
The Merger Agreement contains customary representations, warranties and covenants, including, among others, covenants regarding the conduct of our business during the pendency of the transactions contemplated by the Merger Agreement including restrictions on our ability in certain cases to enter into contracts, acquire or dispose of assets, enter into new lines of business, incur indebtedness or incur capital expenditures (subject to certain exceptions, as detailed in the Merger Agreement) until the Merger becomes effective or the Merger Agreement is terminated. These restrictions could prevent us from pursuing attractive business opportunities that may arise prior to the consummation of the Merger, and result in our inability to respond effectively to competitive pressures and industry developments, and may otherwise harm our business and operations.
Litigation could arise in connection with the Merger; such litigation against us could result in substantial costs, an injunction preventing the completion of the Merger and/or a judgment resulting in the payment of damages.
Securities class action lawsuits and derivative lawsuits are often brought against public companies that have entered into merger agreements. Our stockholders may file lawsuits against us and/or our directors and officers in connection with the Merger. Even if any such lawsuits are unsuccessful, defending against them may result in substantial costs. Lawsuits could prevent or delay the completion of the Merger and result in significant costs to us, including any costs associated with the indemnification of directors and officers. There can be no assurance regarding the outcome of any potential future lawsuit or the costs associated with defending against any such potential future lawsuit.
ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Issuer Purchases of Equity Securities
On November 4, 2025, the Company announced that its Board of Directors authorized a new share repurchase program allowing for purchases of up to $200.0 million in the aggregate of outstanding Integer common stock (the “Share Repurchase Program”). The Share Repurchase Program has no expiration date and will continue until otherwise suspended or terminated. The Company did not make any repurchases during the three months ended July 3, 2026. As of July 3, 2026, the dollar value of shares that may yet be purchased under the Share Repurchase Program was $100 million.
ITEM 5.OTHER INFORMATION
Rule 10b5-1 Plan Trading Arrangements
During the fiscal quarter ended July 3, 2026, none of the Company’s directors or executive officers adopted terminated
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ITEM 6.EXHIBITS
| Exhibit Number | Description | |||||||
| 2.1 | ||||||||
| 3.1 | ||||||||
| 10.1# | ||||||||
| 10.2* | ||||||||
| 10.3#* | ||||||||
| 10.4#* | ||||||||
| 10.5#* | ||||||||
| 10.6#* | ||||||||
| 10.7#* | ||||||||
| 10.8#* | ||||||||
| 10.9#* | ||||||||
| 10.10#* | ||||||||
| 10.11# | ||||||||
| 31.1* | ||||||||
| 31.2* | ||||||||
| 32.1** | ||||||||
| 101.INS* | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |||||||
| 101.SCH* | XBRL Extension Schema Document | |||||||
| 101.CAL* | XBRL Extension Calculation Linkbase Document | |||||||
| 101.LAB* | XBRL Extension Label Linkbase Document | |||||||
| 101.PRE* | XBRL Extension Presentation Linkbase Document | |||||||
| 101.DEF* | XBRL Extension Definition Linkbase Document | |||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document and included in Exhibit 101). | |||||||
| * | Filed herewith. | ||||
| ** | Furnished herewith. | ||||
| # | Indicates exhibits that are management contracts or compensation plans or arrangements. | ||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Dated: | August 4, 2026 | INTEGER HOLDINGS CORPORATION | |||||||||||||||
| By: | /s/ Payman Khales | ||||||||||||||||
| Payman Khales | |||||||||||||||||
| President and Chief Executive Officer | |||||||||||||||||
| (Principal Executive Officer) | |||||||||||||||||
| By: | /s/ Diron Smith | ||||||||||||||||
| Diron Smith | |||||||||||||||||
| Executive Vice President and Chief Financial Officer | |||||||||||||||||
| (Principal Financial Officer) | |||||||||||||||||
| By: | /s/ Tom P. Thomas | ||||||||||||||||
| Tom P. Thomas | |||||||||||||||||
| Vice President, Corporate Controller | |||||||||||||||||
| (Principal Accounting Officer) | |||||||||||||||||
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INTEGER HOLDINGS CORPORATION
2026 OMNIBUS INCENTIVE PLAN
2026 OMNIBUS INCENTIVE PLAN
RSU AGREEMENT FOR NON-EMPLOYEE DIRECTORS
The Participant has been granted an Award (the “Award”) of Restricted Stock Units (“RSUs”) pursuant to the Integer Holdings Corporation 2026 Omnibus Incentive Plan (as it may be amended from time to time, the “Plan”), and this RSU Agreement (this “Agreement”), dated as indicated in Appendix A (the “Grant Date”). Except as otherwise indicated, any capitalized term used but not defined herein shall have the meaning set forth in the Plan.
1.Issuance of Shares. Each RSU shall represent the right to receive one Share upon the vesting of such RSU, as determined in accordance with and subject to the terms of this Agreement and the Plan. The number of RSUs is set forth in Appendix A.
2.Vesting Dates. Subject to Section 3, the Award shall vest on the dates set forth in Appendix A. For purposes of this Agreement, “Vesting Date” means each applicable vesting date set forth in Appendix A or, if earlier, an accelerated vesting date upon Termination of Service in accordance with Section 3.
3.Termination of Service; Change in Control. In the event of a Termination of Service or Change in Control, the RSUs will be treated in accordance with Section 12 of the Plan. Notwithstanding any contrary provision of this Agreement, the balance of the RSUs that have not vested pursuant to Section 2 or this Section 3 will be automatically forfeited as of the date that the Participant’s services as a Director terminate for any reason.
4.Voting Rights. The Participant shall have no voting rights or any other rights as a shareholder of the Company with respect to the RSUs unless and until the Participant becomes the record owner of the Shares underlying the RSUs.
5.Dividend Equivalents. If a dividend is declared on Shares during the period commencing on the Grant Date and ending on the date on which the Shares underlying the RSUs are distributed to the Participant pursuant to this Agreement, the Participant shall be eligible to receive an amount equal to the dividend that the Participant would have received had the Shares underlying the RSUs been held by the Participant as of the record date for such dividend (a “Dividend Equivalent”). Such Dividend Equivalent will be subject to the same vesting conditions as the original RSU granted under this Agreement. Each Dividend Equivalent will be settled in cash as soon as reasonably practicable (and in no event later than 60 days) after the applicable Vesting Date of the corresponding RSUs. For clarity, no Dividend Equivalent will be paid with respect to any RSUs that are forfeited.
6.Distribution of Shares. Subject to the provisions of this Agreement, upon the Vesting Date of any of the RSUs, the Company shall deliver to the Participant, as soon as reasonably practicable (and in no event later than 60 days) after the applicable Vesting Date, one Share for each such RSU. Upon the delivery of Shares, such Shares shall be fully assignable, alienable, saleable and transferrable by the Participant; provided that any such assignment, alienation, sale, transfer or other alienation with respect to such Shares shall be in accordance with applicable securities laws and any applicable Company policy.
1
7.Responsibility for Taxes. The Participant acknowledges that, regardless of any action taken by the Company, the ultimate liability for all income tax, social insurance, payroll tax, fringe benefits tax, payment on account or other tax-related items related to the Participant’s participation in the Plan and legally applicable to the Participant (“Tax-Related Items”) is and remains the Participant’s responsibility and may exceed the amount actually withheld by the Company. The Participant further acknowledges that the Company (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including, but not limited to, the grant, vesting or settlement of the Award, the subsequent sale of Shares acquired upon settlement of the Award and the receipt of any dividends and/or Dividend Equivalents; and (ii) does not commit to and is under no obligation to structure the terms of the grant or any aspect of the Award to reduce or eliminate the Participant’s liability for Tax-Related Items or achieve any particular tax result.
8.Cancellation/Clawback. The Participant hereby acknowledges and agrees that the Participant and the Award are subject to the terms and conditions of Section 18 (Cancellation or “Clawback” of Awards) of the Plan.
9.Provisions of Plan Control. This Agreement is subject to all the terms, conditions and provisions of the Plan, including the amendment provisions thereof, and to such rules, regulations and interpretations relating to the Plan as may be adopted by the Committee and as may be in effect from time to time. The Plan is incorporated herein by reference. If and to the extent that this Agreement conflicts or is inconsistent with the Plan, the Plan shall control, and this Agreement shall be deemed to be modified accordingly.
10.Notices. Any notice required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given when delivered personally or by courier, or sent by certified or registered mail, postage prepaid, return receipt requested, duly addressed to the party concerned at the address indicated below or to such changed address as such party may subsequently by similar process give notice of:
If to the Company:
Integer Holdings Corporation
Corporate Secretary, Integer Holdings Corporation
5830 Granite Parkway, Suite 1150, Plano, Texas 75024
Attention: General Counsel
Attention: General Counsel
If to the Participant, to the address of the Participant on file with the Company.
11.No Right to Continued Service. The grant of the Award shall not be construed as giving the Participant the right to be retained in the employ of, or to continue to provide services to, the Company or any Affiliate.
12.No Right to Future Awards. Any Award granted under the Plan shall be a one-time Award that does not constitute a promise of future grants. The Company, in its sole discretion, maintains the right to make available future grants under the Plan.
2
13.Transfer of RSUs. Except as may be permitted by the Committee, neither the Award nor any right under the Award shall be assignable, alienable, saleable or transferable by the Participant other than (a) by will or pursuant to the laws of descent and distribution or (b) by order of any court of competent jurisdiction, including with respect to any domestic relations order or divorce decree. This provision shall not apply to any portion of the Award that has been fully settled and shall not preclude forfeiture of any portion of the Award in accordance with the terms herein.
14.Entire Agreement. This Agreement, the Plan and any other agreements, schedules, exhibits and other documents referred to herein or therein constitute the entire agreement and understanding between the parties in respect of the subject matter hereof and supersede all prior and contemporaneous arrangements, agreements and understandings, both oral and written, whether in term sheets, presentations or otherwise, between the parties with respect to the subject matter hereof.
15.Severability. If any provision of this Agreement is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction, or would disqualify the Plan or this Agreement under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended without, in the determination of the Committee, materially altering the intent of this Agreement, such provision shall be stricken as to such jurisdiction, and the remainder of this Agreement shall remain in full force and effect.
16.Amendment; Waiver. No amendment or modification of any provision of this Agreement that has a material adverse effect on the Participant shall be effective unless signed in writing by or on behalf of the Company and the Participant; provided that the Company may amend or modify this Agreement without the Participant’s consent in accordance with the provisions of the Plan or as otherwise set forth in this Agreement. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition, whether of like or different nature. Any amendment or modification of or to any provision of this Agreement, or any waiver of any provision of this Agreement, shall be effective only in the specific instance and for the specific purpose for which such amendment, modification or waiver is made or given.
17.Assignment. Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by the Participant.
18.Successors and Assigns; No Third-Party Beneficiaries. This Agreement shall inure to the benefit of and be binding upon the Company and the Participant and their respective Beneficiaries, successors, legal representatives and permitted assigns. Nothing in this Agreement, express or implied, is intended to confer on any Person other than the Company and the Participant, and their respective Beneficiaries, successors, legal representatives and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.
19.Dispute Resolution. All controversies and claims arising out of or relating to this Agreement, or the breach hereof, shall be settled by the Company’s mandatory dispute resolution
3
procedures, if any, as may be in effect from time to time with respect to matters arising out of or relating to the Participant’s employment with the Company.
20.Governing Law; Venue. All matters arising out of or relating to this Agreement and the transactions contemplated hereby, including its validity, interpretation, construction, performance and enforcement, shall be governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to its principles of conflict of laws. For purposes of any action, lawsuit or other proceedings brought to enforce this Agreement, relating to it, or arising from it, the parties hereby submit to and consent to the sole and exclusive venue of the courts of Collin County, Texas, or the federal courts for the United States for the Eastern District of Texas, and no other courts.
21.Imposition of other Requirements and Participant Undertaking. The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on the Award and on any Shares to be issued upon settlement of the Award, to the extent the Company determines it is necessary or advisable for legal or administrative reasons. The Participant agrees to take whatever additional action and execute whatever additional documents the Company may deem necessary or advisable to accomplish the foregoing or to carry out or give effect to any of the obligations or restrictions imposed on either the Participant or the RSU pursuant to this Agreement.
22.References. References herein to rights and obligations of the Participant shall apply, where appropriate, to the Participant’s legal representative or Beneficiaries without regard to whether specific reference to such legal representative or Beneficiaries is contained in a particular provision of this Agreement.
4
Acceptance, Acknowledgment and Receipt
By accepting this Agreement, I, the Participant, hereby:
●acknowledge and confirm my consent to receive electronically this Agreement, the Plan and any other Plan documents or other related communications that the Company wishes or is required to deliver;
●acknowledge that a copy of the Plan and the related Plan documents were made available to me;
●agree that the electronic acceptance of this Agreement constitutes a legally binding acceptance of this Agreement, and that the electronic acceptance of this Agreement shall have the same force and effect as if this Agreement was physically signed; and
●agree to be bound by the terms of this Agreement, including any Appendices attached hereto, and the Plan.
I acknowledge and agree that, if I have not accepted this Agreement within 75 days following the Grant Date, this Award will be forfeited in its entirety and I will not receive any compensation with respect to this Award.
5
Appendix A
PARTICIPANT: #Participant Name#
Except as otherwise indicated, any capitalized term used but not defined herein shall have the meaning set forth in the Integer Holdings Corporation 2026 Omnibus Incentive Plan (as it may be amended from time to time, the “Plan”).
The Participant has been granted an Award of RSUs under the Plan, subject to the terms and conditions of the Plan and the Agreement.
Date of Grant: #Grant Date#
Grant Number: #Client Grant ID#
Number of RSUs: #Number of Awards Granted#
Vesting Schedule: #Vesting Schedule (Dates & Quantities)#
A-1
INTEGER HOLDINGS CORPORATION
2026 OMNIBUS INCENTIVE PLAN
RSU AGREEMENT FOR U.S. PARTICIPANTS (TIME-BASED VESTING)
The Participant has been granted an Award (the “Award”) of Restricted Stock Units (“RSUs”) pursuant to the Integer Holdings Corporation 2026 Omnibus Incentive Plan (as it may be amended from time to time, the “Plan”), and this RSU Agreement (this “Agreement”), dated as indicated in Appendix A (the “Grant Date”). Except as otherwise indicated, any capitalized term used but not defined herein shall have the meaning set forth in the Plan.
1.Issuance of Shares. Each RSU shall represent the right to receive one Share upon the vesting of such RSU, as determined in accordance with and subject to the terms of this Agreement and the Plan. The number of RSUs is set forth in Appendix A.
2.Vesting Dates. Subject to Section 3, the Award shall vest on the dates set forth in Appendix A. For purposes of this Agreement, “Vesting Date” means each applicable vesting date set forth in Appendix A or, if earlier, an accelerated vesting date upon Termination of Service in accordance with Sections 3 or 4.
3.Termination of Service.
(a)Voluntary or Involuntary Termination. In the event of the Participant’s voluntary or involuntary Termination of Service for any reason other than by the Company for Cause or due to death or Disability:
(i)If the Participant is Retirement Eligible (as defined below), any RSUs that are not vested as of the date of such Termination of Service, as well as any Dividend Equivalents that are not vested as of the date of such Termination of Service, will vest in full.
(ii)If the Participant is not Retirement Eligible, any RSUs that are not vested as of the date of such Termination of Service, as well as any Dividend Equivalents that are not vested as of the date of such Termination of Service, will be forfeited.
For purposes of this Agreement, “Retirement Eligible” means the Participant’s Termination of Service with the Company (other than termination for Cause, or due to death or Disability) occurring on or after the date (i) the Participant has attained age 59 1⁄2 and (ii) the sum of the Participant’s age and length of service with the Company equals at least 69 1⁄2 years, in each case with such age and length of service determined based on days.
(b)Termination Due to Death or Disability. In the event of the Participant’s Termination of Service due to death or Disability, any RSUs that are not vested as of the
1
date of such Termination of Service, as well as any Dividend Equivalents that are not vested as of the date of such Termination of Service, will vest in full.
(c)Termination For Cause. In the event of the Participant’s Termination of Service by the Company for Cause, any unvested RSUs and any unpaid Dividend Equivalents will be forfeited.
4.Change in Control. In the event of a Change in Control, the RSUs will be treated in accordance with Section 12(c) of the Plan as follows:
(a)If the provisions of Section 12(c)(i) of the Plan apply to the Award, the occurrence of the Participant’s Qualifying Termination (as defined under Section 12(c) of the Plan) shall be an accelerated Vesting Date under Section 2 and shall trigger a distribution of the outstanding RSUs under Section 7 and related Dividend Equivalents under Section 6.
(b)If the provisions of Section 12(c)(ii) of the Plan apply, the outstanding RSUs shall vest upon the Change in Control and the Company shall have a unilateral right to terminate this Agreement and distribute the RSUs and Dividend Equivalents, on or as soon as reasonably practicable (and in no event later than 30 days) following the Change in Control, provided that, if the Award is subject to Section 409A of the Code, such termination will be pursuant to and in accordance with the requirements of Treasury Regulations 1.409A-3(j)(4)(ix)(B) or any successor provision.
5.Voting Rights. The Participant shall have no voting rights or any other rights as a shareholder of the Company with respect to the RSUs unless and until the Participant becomes the record owner of the Shares underlying the RSUs.
6.Dividend Equivalents. If a dividend is declared on Shares during the period commencing on the Grant Date and ending on the date on which the Shares underlying the RSUs are distributed to the Participant pursuant to this Agreement, the Participant shall be eligible to receive an amount equal to the dividend that the Participant would have received had the Shares underlying the RSUs been held by the Participant as of the record date for such dividend (a “Dividend Equivalent”). Such Dividend Equivalent will be subject to the same vesting conditions as the original RSU granted under this Agreement. Each Dividend Equivalent will be settled in cash as soon as reasonably practicable (and in no event later than 60 days) after the applicable Vesting Date of the corresponding RSUs. For clarity, no Dividend Equivalent will be paid with respect to any RSUs that are forfeited.
7.Distribution of Shares. Subject to the provisions of this Agreement, upon the Vesting Date of any of the RSUs, the Company shall deliver to the Participant, as soon as reasonably practicable (and in no event later than 60 days) after the applicable Vesting Date, one Share for each such RSU. Upon the delivery of Shares, such Shares shall be fully assignable, alienable, saleable and transferrable by the Participant; provided that any such assignment, alienation, sale, transfer or other alienation with respect to such Shares shall be in accordance with applicable securities laws and any applicable Company policy.
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8.Responsibility for Taxes.
(a)The Participant acknowledges that, regardless of any action taken by the Company, the ultimate liability for all income tax, social insurance, payroll tax, fringe benefits tax, payment on account or other tax-related items related to the Participant’s participation in the Plan and legally applicable to the Participant (“Tax-Related Items”) is and remains the Participant’s responsibility and may exceed the amount actually withheld by the Company. The Participant further acknowledges that the Company (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including, but not limited to, the grant, vesting or settlement of the Award, the subsequent sale of Shares acquired upon settlement of the Award and the receipt of any dividends and/or Dividend Equivalents; and (ii) does not commit to and is under no obligation to structure the terms of the grant or any aspect of the Award to reduce or eliminate the Participant’s liability for Tax-Related Items or achieve any particular tax result. Further, if the Participant is subject to Tax-Related Items in more than one jurisdiction, the Participant acknowledges that the Company may be required to withhold or account for Tax-Related Items in more than one jurisdiction.
(b)Prior to any relevant taxable or tax withholding event, as applicable, the Participant agrees to make adequate arrangements satisfactory to the Company to satisfy all Tax-Related Items. In this regard, the Participant authorizes the Company, or its respective agents, at its discretion, to satisfy any applicable withholding obligations with regard to all Tax-Related Items in the manner determined by the Company from time to time, which may include: (i) withholding from the Participant’s wages or other cash compensation paid to the Participant by the Company; (ii) requiring the Participant to remit the aggregate amount of such Tax-Related Items to the Company in full, in cash or by check, bank draft or money order payable to the order of the Company; (iii) through a procedure whereby the Participant delivers irrevocable instructions to a broker designated by the Committee to sell Shares obtained upon settlement of the Award and to deliver promptly to the Company an amount of the proceeds of such sale equal to the amount of the Tax-Related Items; (iv) by a “net settlement” under which the Company reduces the number of Shares issued on settlement of the Award by the number of Shares with an aggregate fair market value that equals the amount of the Tax-Related Items associated with such settlement; or (v) any other method of withholding determined by the Company and permitted by applicable law.
(c)Depending on the withholding method, the Company may withhold or account for Tax-Related Items by considering applicable minimum statutory withholding rates or other applicable withholding rates, including maximum applicable rates, in which case the Participant will receive a refund of any over-withheld amount in cash and will have no entitlement to the equivalent number of Shares. If the obligation for Tax-Related Items is satisfied by withholding in Shares, for tax purposes, the Participant is deemed to have been issued the full number of Shares subject to the settled Award, notwithstanding that a number of the Shares are held back solely for the purpose of paying the Tax-Related Items. Notwithstanding the other provisions of this Section 8(c), except as may be authorized by the Committee (in compliance with Section 409A of the Code, if
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applicable), if vesting occurs prior to payment and applicable law requires the payment of employment taxes at such time, then (i) the Company shall withhold from the RSUs the number of RSUs (rounded down to nearest whole share, with the Participant responsible for paying to the Company in cash any additional amount due) having a value equal to the minimum amount of the Tax-Related Items required to be withheld under applicable law and regulations, in a manner that complies with Section 409A of the Code, if applicable, (ii) the Company shall pay the amount of such withholding taxes in cash to the appropriate taxing authorities, and (iii) the Participant shall have no entitlement to such withheld RSUs thereafter.
(d)Finally, the Participant agrees to pay to the Company any amount of Tax-Related Items that the Company may be required to withhold or account for as a result of the Participant’s participation in the Plan that cannot be satisfied by the means previously described. The Company may refuse to issue or deliver the Shares or the proceeds of the sale of Shares, if the Participant fails to comply with the Participant’s obligations in connection with the Tax-Related Items.
9.Not Salary, Pensionable Earnings or Base Pay. The Participant acknowledges that the Award shall not be included in or deemed to be a part of (a) salary, normal salary or other ordinary compensation, (b) any definition of pensionable or other earnings (however defined) for the purpose of calculating any benefits payable to or on behalf of the Participant under any pension, retirement, termination or dismissal indemnity, severance benefit, retirement indemnity or other benefit arrangement of the Company or any Affiliate or (c) any calculation of base pay or regular pay for any purpose.
10.Cancellation/Clawback. The Participant hereby acknowledges and agrees that the Participant and the Award are subject to the terms and conditions of Section 18 (Cancellation or “Clawback” of Awards) of the Plan.
11.Restrictive Covenant Agreement. As a condition to the Participant’s receipt of this grant of RSUs, the Participant acknowledges and agrees to and reaffirms all continuing obligations and duties the Participant has under any invention assignment, non-disclosure, non-competition, and/or non-solicitation agreement between the Participant and the Company, and any other obligations and duties which the Participant may have to: (a) safeguard the Company’s confidential information; (b) assign inventions to the Company; (c) avoid competing with the Company; or (d) avoid soliciting of the Company’s customers, suppliers, or employees. In addition to all such obligations and duties, the Participant further agrees to be bound by the obligations and duties set forth in Appendix B, Appendix C, or Appendix D hereto as applicable to the Participant based on the Participant’s state of residence. The RSUs granted to the Participant under this Award Agreement would not be granted to the Participant but for the Participant’s express agreement to and reaffirmation of such continuing obligations and duties, and this grant of RSUs shall constitute additional consideration for all such obligations and duties.
12.Provisions of Plan Control. This Agreement is subject to all the terms, conditions and provisions of the Plan, including the amendment provisions thereof, and to such rules, regulations and interpretations relating to the Plan as may be adopted by the Committee and as may be in effect from time to time. The Plan is incorporated herein by reference. If and to
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the extent that this Agreement conflicts or is inconsistent with the Plan, the Plan shall control, and this Agreement shall be deemed to be modified accordingly.
13.Notices. Any notice required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given when delivered personally or by courier, or sent by certified or registered mail, postage prepaid, return receipt requested, duly addressed to the party concerned at the address indicated below or to such changed address as such party may subsequently by similar process give notice of:
If to the Company:
Integer Holdings Corporation
Corporate Secretary, Integer Holdings Corporation 5830 Granite Parkway, Suite 1150, Plano, Texas 75024 Attention: General Counsel
If to the Participant, to the address of the Participant on file with the Company.
14.No Right to Continued Service. The grant of the Award shall not be construed as giving the Participant the right to be retained in the employ of, or to continue to provide services to, the Company or any Affiliate.
15.No Right to Future Awards. Any Award granted under the Plan shall be a one-time Award that does not constitute a promise of future grants. The Company, in its sole discretion, maintains the right to make available future grants under the Plan.
16.Transfer of RSUs. Except as may be permitted by the Committee, neither the Award nor any right under the Award shall be assignable, alienable, saleable or transferable by the Participant other than (a) by will or pursuant to the laws of descent and distribution or (b) by order of any court of competent jurisdiction, including with respect to any domestic relations order or divorce decree. This provision shall not apply to any portion of the Award that has been fully settled and shall not preclude forfeiture of any portion of the Award in accordance with the terms herein.
17.Entire Agreement. This Agreement, the Plan and any other agreements, schedules, exhibits and other documents referred to herein or therein constitute the entire agreement and understanding between the parties in respect of the subject matter hereof and supersede all prior and contemporaneous arrangements, agreements and understandings, both oral and written, whether in term sheets, presentations or otherwise, between the parties with respect to the subject matter hereof.
18.Severability. If any provision of this Agreement is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction, or would disqualify the Plan or this Agreement under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended without, in the determination of the Committee, materially altering the intent
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of this Agreement, such provision shall be stricken as to such jurisdiction, and the remainder of this Agreement shall remain in full force and effect.
19.Amendment; Waiver. No amendment or modification of any provision of this Agreement that has a material adverse effect on the Participant shall be effective unless signed in writing by or on behalf of the Company and the Participant; provided that the Company may amend or modify this Agreement without the Participant’s consent in accordance with the provisions of the Plan or as otherwise set forth in this Agreement. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition, whether of like or different nature. Any amendment or modification of or to any provision of this Agreement, or any waiver of any provision of this Agreement, shall be effective only in the specific instance and for the specific purpose for which such amendment, modification or waiver is made or given and, if applicable, shall be in accordance with the requirements of Section 409A of the Code.
20.Assignment. Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by the Participant.
21.Successors and Assigns; No Third-Party Beneficiaries. This Agreement shall inure to the benefit of and be binding upon the Company and the Participant and their respective Beneficiaries, successors, legal representatives and permitted assigns. Nothing in this Agreement, express or implied, is intended to confer on any Person other than the Company and the Participant, and their respective Beneficiaries, successors, legal representatives and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.
22.Dispute Resolution. All controversies and claims arising out of or relating to this Agreement, or the breach hereof, shall be settled by the Company’s mandatory dispute resolution procedures, if any, as may be in effect from time to time with respect to matters arising out of or relating to the Participant’s employment with the Company.
23.Governing Law; Venue. All matters arising out of or relating to this Agreement (other than Appendix B) and the transactions contemplated hereby, including its validity, interpretation, construction, performance and enforcement, shall be governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to its principles of conflict of laws. Appendix B shall be governed by Texas law, as described therein. For purposes of any action, lawsuit or other proceedings brought to enforce this Agreement, relating to it, or arising from it, the parties hereby submit to and consent to the sole and exclusive venue of the courts of Collin County, Texas, or the federal courts for the United States for the Eastern District of Texas, and no other courts.
24.Imposition of other Requirements and Participant Undertaking. The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on the Award and on any Shares to be issued upon settlement of the Award, to the extent the Company determines it is necessary or advisable for legal or administrative reasons. The Participant agrees to take whatever additional action and execute whatever additional documents the Company may deem necessary or advisable to accomplish the foregoing or to carry out or
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give effect to any of the obligations or restrictions imposed on either the Participant or the RSU pursuant to this Agreement.
25.References. References herein to rights and obligations of the Participant shall apply, where appropriate, to the Participant’s legal representative or Beneficiary without regard to whether specific reference to such legal representative or Beneficiary is contained in a particular provision of this Agreement.
Acceptance, Acknowledgment and Receipt
By accepting this Agreement, I, the Participant, hereby:
●acknowledge and confirm my consent to receive electronically this Agreement, the Plan and any other Plan documents or other related communications that the Company wishes or is required to deliver;
●acknowledge that a copy of the Plan and the related Plan documents were made available to me;
●agree that the electronic acceptance of this Agreement constitutes a legally binding acceptance of this Agreement, and that the electronic acceptance of this Agreement shall have the same force and effect as if this Agreement was physically signed; and
●agree to be bound by the terms of this Agreement, including any Appendices attached hereto, and the Plan.
I acknowledge and agree that, if I have not accepted this Agreement within 75 days following the Grant Date, this Award will be forfeited in its entirety and I will not receive any compensation with respect to this Award.
AGREED TO:
| THE PARTICIPANT: | THE COMPANY: | |||||||||||||
[Electronic Signature] | ||||||||||||||
| Name: | [Participant Name] | By: | Chief Human Resources Officer | |||||||||||
| Date: | [Acceptance Date] | Date: | [Grant Date] | |||||||||||
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Appendix A
PARTICIPANT: [Participant Name]
Except as otherwise indicated, any capitalized term used but not defined herein shall have the meaning set forth in the Integer Holdings Corporation 2026 Omnibus Incentive Plan (as it may be amended from time to time, the “Plan”).
The Participant has been granted an Award of RSUs under the Plan, subject to the terms and conditions of the Plan and the Agreement.
Date of Grant: [Grant Date]
Grant Number: [Client Grant ID]
Number of RSUs: [Number of Awards Granted]
Vesting Schedule: [Vesting Schedule (Dates & Quantities)]
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Appendix B
Restrictive Covenant Agreement
(Applicable to U.S. participants in all states except CA, MA, MN, MT, and OK)
As a condition to the Participant’s receipt of this grant of RSUs, the Participant covenants and agrees to abide by the following restrictive covenants, which shall be in addition to, rather than in lieu of, any other obligations that the Participant may have under any other confidentiality, invention assignment, non-disclosure, non-competition, and/or non-solicitation agreement or similar agreement between the Participant and Integer Holdings Corporation (the “Company”). Capitalized terms not otherwise defined in this Appendix B have the meanings ascribed to them in the Plan and the Agreement.
1.Restrictive Covenants.
a.Participant Acknowledgement. The Participant recognizes that the Integer Companies have invested significant time and resources to train employees and develop the Confidential Information and to establish substantial relationships and goodwill with the Integer Companies’ current and prospective business relationships. The Participant acknowledges and agrees that the highly competitive nature of the Integer Companies’ business, the Participant’s key position with the Integer Companies, and the Confidential Information, company relationships, specialized training, and association with goodwill provided to the Participant during the Employment Period support and make necessary the reasonable promises from the Participant in this Section 1 and also support the Participant’s duty of loyalty and other fiduciary obligations to the Integer Companies under applicable state law.
b.Confidential Information. In the course of the Participant’s employment with the Integer Companies and the performance of the Participant’s duties on behalf of the Integer Companies, the Participant will be provided with, and will have access to, Confidential Information. Both during the Employment Period and thereafter, except as expressly permitted by this Agreement, the Participant shall not disclose any Confidential Information to any Person and shall not use any Confidential Information except for the benefit of the Integer Companies. The Participant acknowledges and agrees that the Participant would inevitably use and disclose Confidential Information in violation of this Section 1(b) if the Participant were to violate any of the covenants set forth in this Section 1. The Participant shall follow all policies and protocols of the Integer Companies regarding the security of all documents and other materials containing Confidential Information (regardless of the medium on which Confidential Information is stored). The Participant understands and acknowledges that the Participant’s obligations under this Agreement with regard to any particular Confidential Information shall commence immediately upon the Participant first having access to such Confidential Information and shall continue during and after the Employment Period until such time as such Confidential
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Information has become public knowledge other than as a result of the Participant’s breach of this Agreement or breach by those acting in concert with the Participant or on the Participant’s behalf.
c.Protected Activities. Notwithstanding the foregoing Section 1(b), nothing in this Agreement shall prohibit or restrict the Participant from lawfully (i) initiating communications directly with, cooperating with, providing information to, causing information to be provided to, or otherwise assisting in an investigation by, any governmental authority (including, without limitation the Equal Employment Opportunity Commission, the National Labor Relations Board, the Department of Labor, or the Securities and Exchange Commission (the “SEC”)) regarding a possible violation of any law, (ii) responding to any inquiry or legal process directed to the Participant from any such governmental authority, (iii) testifying, participating or otherwise assisting in any action or proceeding by any such governmental authority relating to a possible violation of law, or (iv) making any other disclosures that are protected under the whistleblower provisions of any applicable law. Additionally, pursuant to the federal Defend Trade Secrets Act of 2016, an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (A) is made (1) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney and (2) solely for the purpose of reporting or investigating a suspected violation of law, (B) is made to the individual’s attorney in relation to a lawsuit for retaliation against the individual for reporting a suspected violation of law, or (C) is made in a complaint or other document filed in a lawsuit or proceeding, if such filing is made under seal. Nothing in this Agreement requires the Participant to obtain prior authorization before engaging in any conduct described in this Section 1(c) or to notify the Integer Companies that the Participant has engaged in any such conduct. Further, nothing herein restricts the Participant’s ability to collect an award in connection with a report or disclosure to the SEC or any other governmental agency.
d.Restriction on Competitive Activity. As a key employee of the Integer Companies who will, by virtue of the Participant’s employment with the Integer Companies, have access to Confidential Information, the Participant recognizes that it would cause irreparable harm to the Integer Companies if the Participant were to provide services in employment or business that are unfairly competitive with the business of the Integer Companies. Accordingly, the Participant agrees that the Participant will not, and will not attempt to, at any time during the Employment Period and thereafter during the Restricted Period: (i) directly or indirectly invest in, own, manage, operate, finance, control or participate in the ownership, management, operation, financing, or control of any Competing Business or (ii) be employed or engaged by, or otherwise associated with, any Competing Business. The foregoing notwithstanding: (A) if the Participant resides in New York and the Participant’s employment is terminated by the Integer Companies without Cause, then the restrictions in this Section 1(d) shall only apply during the Employment Period; (B) during the Restricted Period, (1) the Participant’s obligations under this Section 1(d) shall only restrict the Participant’s activities
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insomuch as Participant’s activities and/or the applicable business activities of the Competing Business (in either case, whether actual or planned) (x) occur at a physical location within the Restricted Territory or (y) are aimed or directed at, target, or reach into the Restricted Territory, regardless of the physical location from which such activities emanate, and (2) the Participant’s obligations under Section 1(d)(ii) shall not exclude Participant from any role for which there is no possible use of the Confidential Information to provide a business advantage to the Competing Business. Nothing in this Section 1(d) shall restrict Participant from owning up to five percent (5%) of any class of securities of any enterprise (but without otherwise participating in the management or activities of such enterprise) if such securities are listed on any national or regional securities exchange or have been registered under Section 12(g) of the Exchange Act.
e.Customer Non-Solicitation. The Participant agrees that, during the Employment Period and thereafter during the Restricted Period, the Participant will not, either directly or indirectly, alone or in conjunction with any other Person (other than the Integer Companies) (i) solicit or do business with any Restricted Customer for the benefit of a Competing Business or (ii) in any other manner attempt to influence, induce, or encourage any Restricted Customer to discontinue or change, in a manner adverse to the Integer Companies, its relationship or business with, or purchases or orders from, the Integer Companies, including by ceasing, not increasing, or decreasing the volume of business the Restricted Customer provides to the Integer Companies. During the Restricted Period, the Participant’s obligations under this Section 1(e) shall only apply to those Restricted Customers for whom the Participant had responsibility or involvement (directly or indirectly) and received Confidential Information about during the Look-Back Period.
f.Employee Non-Solicitation. The Participant agrees that, during the Employment Period and thereafter during the Restricted Period, the Participant will not, either directly or indirectly, alone or in conjunction with any other Person (other than the Integer Companies): (i) solicit, hire, retain or seek to hire or retain any Restricted Service Provider or (ii) in any other manner attempt to influence, induce, or encourage any such Restricted Service Provider to terminate, reduce or materially change in a manner adverse to the Integer Companies, such Restricted Service Provider’s employment or other business relationship with the Integer Companies. During the Restricted Period, the Participant’s obligations under this Section 1(d) shall only apply to those Restricted Service Providers for whom the Participant had responsibility or involvement (directly or indirectly) and received Confidential Information about during the Look-Back Period.
g.Request for Confirmation. The Company agrees that during the Restricted Period, on a case-by-case basis, it will consider a request by the Participant to confirm whether the Company considers a prospective new employer of the Participant (a “New Employer”) to be a Competing Business as of the date of the request. The foregoing shall not apply unless the Participant provides the Company with such written request in writing, including the name and address
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of New Employer and details about the prospective position to be held by the Participant at least 30 calendar days prior to commencing employment with New Employer. Further, upon request, the Company will confirm the geographic scope of the Restricted Territory as of the time of the request.
h.Tolling. Should the Participant violate any of the terms of the restrictive covenant obligations contained in this Section 1, the parties agree that a court of competent jurisdiction shall have the power to extend the obligation(s) at issue to run from the first date on which the Participant ceases to be in violation of such obligation(s).
i.Definitions. For purposes of this Appendix B, the following definitions apply.
i.“Cause” shall mean any reasonable basis for discharge of the Participant’s employment by the Integer Companies that is directly related to the Participant’s conduct, including the Participant’s conduct on the job or otherwise, job performance, and contract or employment record.
ii.“Company Business” means (A) the design, development, manufacture, assembly, sale and provision of medical devices in the cardio and vascular, neuromodulation, and cardiac rhythm management markets and/or (B) any other business activities engaged in by the Integer Companies during the Employment Period. However, Company Business shall not include any business activities for which the Participant had no responsibility, management or involvement and about which the Participant had no access to Confidential Information during the Look-Back Period.
iii.“Competing Business” means a Person (other than the Integer Companies) that engages in, or actively plans to engage in, any business and/or activities that are the same as, substantially similar to, or the functional equivalent of the Company Business and that competes, in whole or in part, with the Company Business.
iv.“Confidential Information” means any information pertaining to the business and operations of the Integer Companies that is not generally available to the public and that is used, developed or obtained by the Integer Companies in connection with its business, including, without limitation, any proprietary information; financial information and projections; business strategies; information about products or services; fees, costs and pricing information; designs, analysis, drawings, computer software, including operating systems, applications and program listings; ; accounting and business methods; inventions, devices, new developments, methods, and processes, whether patentable or unpatentable and whether or not reduced to practice; customers and clients and customer or client lists and preferences; employee information; copyrightable works; all technology and trade secrets;
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information regarding lines of business; and all similar and related information in whatever form.
v.“Employment Period” means the period during which the Participant is employed with or otherwise engaged by the Integer Companies.
vi.“Integer Companies” means the Company, its current subsidiaries, affiliates, and any additional corporation, partnership, limited liability company, joint venture or other business entity that becomes a subsidiary or affiliate of the Company during the Participant’s employment or engagement with the Company.
vii.“Look-Back Period” means the 12-month period immediately preceding the last day of the Employment Period.
viii.“Person” means an individual, firm, corporation, partnership, association, limited liability company, trust or any other entity.
ix.“Restricted Customer” means any Person who (A) is a customer or client of the Integer Companies (or was at any time during the Look-Back Period) or (B) was actively and materially contacted or solicited (directly or indirectly) by the Integer Companies for the purpose of becoming a customer or client of the Integer Companies.
x.“Restricted Period” means the period commencing on the last day of the Employment Period and continuing until the expiration of 12 months therefrom.
xi.“Restricted Service Provider” means any Person who is (or at any time during the Look-Back Period was) employed by or engaged to perform personal services as an independent contractor or consultant for the Integer Companies.
xii.“Restricted Territory” means any county, parish, borough or foreign equivalent, as applicable, within North America, South America, Europe, and/or the Asian Pacific (each, a “Geographic Area”) in which (i) the Integer Companies have, or had during the Look-Back Period, conducted business or written plans to conduct business; (ii) the Integer Companies have, or had during the Look-Back Period, customers or clients; and (iii) the Integer Companies have, or had during the Look-Back Period, an office or facility. However, Restricted Territory shall not include any Geographic Area in which the Participant had no responsibility, no management and no involvement and about which the Participant had no access to Confidential Information, in each case, at any time during the Look-Back Period.
2.Reasonableness of Limitations. The Participant represents and agrees that the restrictive covenants contained herein are reasonable in time, geography, and the scope of activities restricted and no broader than necessary for the protection of the Integer
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Companies’ legitimate business interests. Participant agrees that in the event that any such territorial, time, or other limitation is found to be unreasonable or overbroad by a court of competent jurisdiction, the Participant agrees (a) to the reduction of any said territorial, time, or other limitation, or all of them, to the maximum area, period or scope as such court may determine to be reasonable and (b) that all of the other provisions of this Appendix B shall remain valid, binding and in full force and effect. The Participant acknowledges and understands that the Participant’s promises in Section 1 restrict some of the Participant’s actions during and after employment with the Integer Companies but will not operate to impose an undue hardship upon the Participant and will not prevent the Participant from supporting themselves after separation of employment from the Integer Companies.
3.Consideration. The Participant acknowledges and agrees that they have or will receive sufficient consideration from the Integer Companies in exchange for and to justify the restrictions contained in Section 1, including, without limitation, receipt of the RSUs and access and the opportunity to develop the Integer Companies’ Confidential Information, valuable customer and client relationships, and goodwill.
4.Relief. The Participant acknowledges and agrees that a violation of the restrictions contained in Section 1 of this Appendix B would result in irreparable injury to the Integer Companies for which there would be no adequate remedy at law and, therefore, if the Participant violates, or attempts to violate, any of these restrictions, the Participant consents to any of the Integer Companies seeking an injunction or other equitable relief to prevent the Participant from such violation or attempted violation, in addition to, and not in lieu of, all other remedies available to the Integer Companies in equity or at law. Participant agrees that such injunctive relief may be granted without the requirement that the Integer Companies post a bond or any security (or where such a bond or security is required by law, Participant agrees that a bond of $1,000 shall be sufficient security to support any such injunctive relief).
5.Survival. All of the Participant’s obligations under this Appendix B will survive the termination of the Participant’s employment with the Integer Companies, regardless of the circumstances of or reason(s) for such termination.
6.Severability. If it is determined by any unit, department or agency of government having jurisdiction, whether federal, state or local, or by a court of competent jurisdiction that any portion of this Appendix B is invalid or unenforceable such determination shall not affect the validity or enforceability of the remainder of this Appendix B or any valid clause of an invalid portion of this Appendix B; and if a restriction provided for in this Appendix B is found by a court of competent jurisdiction to be unenforceable as written, the court shall revise the restriction so as to make it enforceable to protect the Integer Companies’ legitimate interest. In this regard, the parties expressly authorize the court to apply, create or modify time, scope or geographic restrictions as needed to make this Appendix B enforceable.
7.Governing Law; Venue. All matters arising out of or relating to this Appendix B, including its validity, interpretation, construction, performance and enforcement, shall
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be governed by and construed in accordance with the internal laws of the State of Texas without giving effect to its principles of conflict of laws. The parties agree that any action, lawsuit or other proceedings relating to, arising out of, or to enforce this Appendix B shall be brought solely in the Texas state district courts for Collin County, Texas or, to the extent any such action is within the subject matter jurisdiction of the federal courts, in the United States District Court for the Eastern District of Texas, and, in each case, in the appellate courts having jurisdiction over such courts. The parties agree that such courts shall be the exclusive venue for any action, lawsuit or other proceedings relating to, arising out of or to enforce this Appendix B and hereby irrevocably consent to and waive any challenge to such courts’ exercise of personal jurisdiction over the parties or venue.
8.Participants in Florida. To the extent that Florida law is deemed to apply to this Appendix B, the Participant is hereby advised that the Participant has the right to consult an attorney prior to executing this Appendix B. The Participant shall have seven (7) days to review this Appendix B prior to signing, but the Participant is not required to take the full seven (7) days and may sign this Appendix B sooner if the Participant so chooses.
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Appendix C
Non-Competition Covenant
(Applicable to participants in MA)
As a condition to the Participant’s receipt of this grant of RSUs, the Participant covenants and agrees to abide by the following Non-Competition covenant, which supersedes and replaces entirely any prior inconsistent Non-Competition covenant that the Participant may have under any invention assignment, non-disclosure, non-competition, and/or non-solicitation agreement or similar agreement between the Participant and the Company; provided, however, nothing herein shall prevent Participant from engaging in the practice of law. Capitalized terms not otherwise defined in the Plan have the meanings set forth in Section 1(e) of this Appendix C.
1.Non-Competition.
a.Restriction on Competitive Activity. As a key employee of the Company who will, by virtue of the Participant’s employment with the Company, have access to Confidential Information, the Participant recognizes that it would cause irreparable harm to the Integer Companies if the Participant were to engage in employment or business that is unfairly competitive with the business of the Integer Companies. Accordingly, the Participant agrees that during the Non-Compete Period, the Participant will not, either directly or indirectly, alone or in conjunction with any other person or entity (other than the Integer Companies), engage in any Prohibited Activity.
b.Prohibited Activity. The Participant acknowledges and agrees that the job duties the Participant performs for the Company affect the Integer Companies throughout their sales territory. Prohibited Activity also includes activity that may require or inevitably require disclosure of Confidential Information.
c.Request for Confirmation. The Company agrees that during the Non-Compete Period, on a case-by-case basis, it will consider a request by the Participant to confirm whether the Company considers a prospective new employer of the Participant’s (a “New Employer”) to be a “Direct Competitor” as of the date of the request. The foregoing shall not apply unless the Participant provides the Company with such written request in writing, including the name and address of New Employer, and details about the prospective position to be held by the Participant at least thirty (30) calendar days prior to commencing employment with New Employer.
d.Tolling. Should the Participant violate any of the terms of the restrictive covenant obligations contained in this Section 1, the obligation at issue will run from the first date on which the Participant ceases to be in violation of such obligation.
e.Definitions. For purposes of this Appendix C, the following definitions apply.
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i.“Confidential Information” means any information pertaining to the business and operations of the Integer Companies that is not generally available to the public and that is used, developed, or obtained by any of the Integer Companies in connection with its business, including any proprietary information and (A) financial information and projections, (B) business strategies, (C) products or services, (D) fees, costs and pricing structures, (E) designs, (F) analysis, (G) drawings, photographs and reports, (H) computer software, including operating systems, applications and program listings, (I) flow charts, manuals and documentation, (J) data bases, (K) accounting and business methods, (L) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice, (M) patients, customers and clients and patient, customer or client lists, (N) copyrightable works, (O) all technology and trade secrets, (P) product categories or lines of business, and (Q) all similar and related information in whatever form.
ii.“Direct Competitor” means, with respect to each Restricted Product Category, a non-Integer Company entity or person (including an Associate or an entity owned in whole or in part by an Associate) that engages in a line of business that is the same as or similar to or which competes, in whole or in part, with such Restricted Product Category.
iii.“Integer Companies” means the Company, its current subsidiaries, affiliates and any additional corporation, partnership, limited liability company, joint venture or other business entity that becomes a subsidiary or affiliate of Integer in the future.
iv.“Non-Compete Period” means twelve consecutive months immediately following the date that the Participant’s employment with the Company terminated (1) with Cause, (2) pursuant to the Participant’s voluntary resignation (including retirement) or (3) or such shorter period as designated by the Company in writing in its sole discretion, during which time the Participant shall be entitled to any post-employment consideration which the Company determines, in its discretion, to pay to the Participant.
v.“Prohibited Activity” means performance of any duties that are:
1.substantially similar to or the same as those which the Participant performed in connection with the Participant’s employment with any Integer Company; and
2.either (A) directly or indirectly relating to or otherwise competitive with any Restricted Product Category products or lines of business; or (B) in any other capacity not limited by product category or line of business within the Integer Companies (e.g., associates who perform corporate functions); and
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3.for or on behalf of either: (A) any Direct Competitor; or (B) any other person or entity that offers, or plans to offer, products or services that are competitive with the products or services provided by, or under development by, any of the Integer Companies.
In any case, an activity is not a Prohibited Activity unless it is performed anywhere in the sales territory of the Integer Companies.
vi.“Restricted Product Category” means any or all of the following product categories or lines of business within the Integer Companies to which the Participant provided services or support, or had access to Confidential Information, during the Participant’s employment: (1) Cardiac Rhythm Management and Neuromodulation; (2) Cardio & Vascular; (3) Power Solutions; or (4) Electrochem. For avoidance of doubt, associates whose work is not limited by product category or line of business, e.g. associates who perform corporate functions, shall be deemed to have provided services or support, or had access to Confidential Information during employment, relating to all product categories and lines of business within the Integer Companies.
2.Reasonableness of Limitations. The Participant represents and agrees that the restrictive covenants contained in herein are necessary for the protection of the Company’s legitimate business interests and are reasonable in scope and content; the territorial, time and other limitations of this Appendix C are reasonable and properly required for the adequate protection of the business and affairs of the Company, and, in the event that any such territorial, time or other limitation is found to be unreasonable by a court of competent jurisdiction, the Participant agrees (a) to the reduction of any said territorial, time or other limitation, or all of them, to the maximum area, period or scope as such court may determine to be reasonable and (b) that all of the other provisions of this Appendix C shall remain valid, binding and in full force and effect. The Participant has been advised of the Participant’s right to consult with legal counsel regarding this Appendix C and the restrictive covenants contained herein and have been afforded an adequate opportunity to do so. This Appendix C is effective ten (10) days after the Agreement, with Appendix C attached, has been provided to the Participant. The Participant has been advised of the Participant’s right to consult with legal counsel regarding this Appendix C and the restrictive covenants contained herein and have been afforded an adequate opportunity to do so.
3.Relief. The Participant acknowledges and agrees that a violation of the restrictions contained in Sections 1 of this Appendix C would result in irreparable injury to the Integer Companies for which there would be no adequate remedy at law and, therefore, if the Participant violates, or attempts to violate, any of these restrictions, the Participant consents to any of the Integer Companies’ seeking an injunction or other equitable relief to prevent the Participant from such violation or attempted violation, in addition to, and not in lieu of, all other remedies available to the Integer Companies in equity or at law.
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4.Survival. All of the Participant’s obligations under this Appendix C will survive the termination of the Participant’s employment with the Company, regardless of the circumstances of or reason(s) for such termination.
5.Severability. If it is determined by any unit, department or agency of government having jurisdiction, whether federal, state or local, or by a court of competent jurisdiction, that any portion of this Appendix C is invalid, or unenforceable, such determination shall not affect the validity or enforceability of the remainder of this Appendix C or any valid clause of an invalid portion of this Appendix C; and if a restriction provided for in this Appendix C is found by a court of competent jurisdiction to be unenforceable as written, the court shall revise the restriction so as to make it enforceable to protect the Integer Company’s legitimate interest. In this regard, the parties expressly authorize the court to apply, create or modify time, scope or geographic restrictions as needed to make this Appendix C enforceable.
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Appendix D
Restrictive Covenant Agreement
(Applicable to participants in CA, MN, MT, and OK)
No further restrictions apply to the Participant.
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INTEGER HOLDINGS CORPORATION 2026 OMNIBUS INCENTIVE PLAN
RSU AGREEMENT FOR U.S. PARTICIPANTS (PERFORMANCE-BASED VESTING)
The Participant has been granted an Award (the “Award”) of Performance-Based Restricted Stock Units (“PSUs”) pursuant to the Integer Holdings Corporation 2026 Omnibus Incentive Plan (as it may be amended from time to time, the “Plan”), and this PSU Agreement (this “Agreement”), dated as indicated in Appendix A (the “Grant Date”). Except as otherwise indicated, any capitalized term used but not defined herein shall have the meaning set forth in the Plan.
1.Issuance of Shares. Each PSU shall represent the right to receive one Share upon the vesting of such PSU, as determined in accordance with and subject to the terms of this Agreement and the Plan. The target number of PSUs is set forth in Appendix A.
2.Vesting Date; Vesting Conditions; Holding Period.
(a)Subject to Section 3 and Section 4, the Award shall vest on the date the Committee certifies the Company’s achievement of the performance metrics set forth in Appendix A following the final date of the Performance Period (as defined in Appendix A), with such certification to occur on or between February 1 and March 10 next following the final date of the Performance Period as set forth on Appendix A (such certification date, the “Vesting Date”), and pursuant to the vesting conditions set forth herein and in Appendix A.
(b)Following the Vesting Date, the earned PSUs underlying this Award shall be fully vested and settled in Shares in accordance with Section 7. If the Shares are subject to any post-vesting holding period, such holding period shall be set forth in Appendix A.
3.Termination of Service.
(a)Voluntary Termination (Not Retirement). Except as set forth in Section 3(c), in the event of the Participant’s voluntary Termination of Service for any reason, any unvested PSUs and any unpaid Dividend Equivalents will be forfeited.
(b)Involuntary Termination. Except as set forth in Sections 3(c), 3(d), 3(e), or 3(f), in the event of the Participant’s involuntary Termination of Service other than for Cause or due to death or Disability:
(i)If the date of the Termination of Service occurs prior to the one-year anniversary of the Grant Date, any PSUs that are not vested as of the date of such Termination of Service, as well as any Dividend Equivalents that are not vested as of the date of such Termination of Service, will be forfeited.
(ii)If the date of the Termination of Services occurs on or following the one year anniversary of the Grant Date, any PSUs that are not vested as of the date of such Termination of Service, as well as any Dividend Equivalents that are not vested as of the date of such Termination of Service, will vest with respect to service-based requirements on the date of Termination of Service on a prorated basis based on the number of days elapsed from and including the Grant Date through and including the date of Termination of Service, divided by the number of days beginning on and including the Grant Date and ending on and excluding the three-year anniversary of the Grant Date (which denominator number, for avoidance of doubt, will generally be either 1095 or 1096 days unless awarded off cycle), with such number of PSUs to be determined by the Committee based on the Company’s performance-based vesting during the entire Performance Period with respect to the performance metrics set forth in Appendix A following the final date of the Performance Period and settled, after applying the proration calculation set forth in this section, after the Vesting Date in accordance with Section 7.
(c)Retirement Eligible Participant. In the event of the Participant’s voluntary or involuntary Termination of Service for any reason other than for Cause or due to death or Disability, and, at the time of such Termination of Service, the Participant is Retirement Eligible (as defined below), any PSUs that are not vested as of the date of such Termination of Service, as well as any Dividend Equivalents that are not vested as of the date of such Termination of Service, will vest with respect to service-based requirements on the date of Termination of Service on a prorated basis based on the number of days elapsed from and including the Grant Date through and including the date of Termination of Service, divided by the number of days beginning on and including the Grant Date and ending on and excluding the three-year anniversary of the Grant Date (which denominator number, for avoidance of doubt, will generally be either 1095 or 1096 days unless awarded off cycle), with such number of PSUs to be determined by the Committee based on the Company’s performance-based vesting during the entire Performance Period with respect to the performance metrics set forth in Appendix A following the final date of the Performance Period and settled, after applying the proration calculation set forth in this section after the Vesting Date in accordance with Section 7. For purposes of this Agreement, “Retirement Eligible” means the Participant’s Termination of Service with the Company (other than termination for Cause, or due to death or Disability) occurring on or after the date (i) the Participant has attained age 59 1⁄2 and (ii) the sum of the Participant’s age and length of service with the Company equals at least 69 1⁄2 years, in each case with such age and length of service determined based on days.
(d)Termination Due to Disability. In the event of the Participant’s Termination of Service due to Disability prior to the Vesting Date, any PSUs that are not vested as of the date of such Termination of Service, as well as any Dividend Equivalents that are not vested as of the date of such Termination of Service, will fully vest (not be pro-rated) with respect to service-based requirements on the date of Termination of Service with such number of PSUs to be determined by the Committee based on the
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Company’s performance-based vesting during the entire Performance Period with respect to the performance metrics set forth in Appendix A following the final date of the Performance Period and settled after the Vesting Date in accordance with Section 7.
(e)Termination Due to Death. In the event of the Participant’s Termination of Service due to death prior to the final date of the Performance Period, any PSUs that are not vested as of the date of such Termination of Service, as well as any Dividend Equivalents that are not vested as of the date of such Termination of Service, will vest in full on the date of Termination of Service at the target level of performance set forth in Appendix A and will be settled as soon as reasonably practicable (and in no event later than 60 days) after the date of Termination of Service due to death. In the event of the Participant’s Termination of Service due to death on or after the final date of the Performance Period, any PSUs that are not vested as of the date of such Termination of Service, as well as any Dividend Equivalents that are not vested as of the date of such Termination of Service, will vest with respect to service-based requirements on the date of Termination of Service with such number of PSUs to be determined by the Committee based on the Company’s performance with respect to the performance metrics set forth in Appendix A following the final date of the Performance Period and will be settled as soon as reasonably practicable (and in no event later than 60 days) after the date of Termination of Service due to death.
(f)Termination For Cause. In the event of the Participant’s Termination of Service by the Company for Cause, any unvested PSUs and any unpaid Dividend Equivalents will be forfeited.
4.Change in Control. In the event of a Change in Control, the PSUs will be treated in accordance with Section 12(c) of the Plan as follows:
(a)If the provisions of Section 12(c)(i) of the Plan apply to the Award, upon the occurrence of the Participant’s Qualifying Termination (as defined under Section 12(c) of the Plan), any outstanding PSUs that are not vested as of the date of the Qualifying Termination, as well as any related Dividend Equivalents that are not vested as of the date of the Qualifying Termination, will vest with respect to service-based requirements on the date of the Qualifying Termination, with such number of PSUs to be determined by the Committee based on the Company’s performance-based vesting for the entire Performance Period with respect to the performance metrics set forth in Appendix A following the final date of the Performance Period and settled after the Vesting Date in accordance with Section 7.
(b)If the provisions of Section 12(c)(ii) of the Plan apply to the Award, any outstanding PSUs, as well as any related Dividend Equivalents, that are not already vested shall vest upon the Change in Control and the Company shall have a unilateral right to terminate this Agreement and distribute the PSUs and Dividend Equivalents on or as soon as reasonably practicable (and in no event later than 30 days) following the Change in Control, provided that, if the Award is subject to Section 409A of the Code,
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such termination will be pursuant to and in accordance with the requirements of Treasury Regulations 1.409A-3(j)(4)(ix)(B) or any successor provision.
5.Voting Rights. The Participant shall have no voting rights or any other rights as a shareholder of the Company with respect to the PSUs unless and until the Participant becomes the record owner of the Shares underlying the PSUs.
6.Dividend Equivalents. If a dividend is declared on Shares during the period commencing on the Grant Date and ending on the date on which the Shares underlying the PSUs are distributed to the Participant pursuant to this Agreement, the Participant shall be eligible to receive an amount equal to the dividend that the Participant would have received had the Shares underlying the PSUs been held by the Participant as of the record date for such dividend (a “Dividend Equivalent”). Such Dividend Equivalent (i) will be subject to the same vesting conditions under this Agreement as are applicable to the corresponding PSU granted under this Agreement and (ii) will be paid at the same time as the corresponding PSU granted under this Agreement as provided in Section 7 (except to the extent either Section 3(e) or Section 4(b) is applicable). For clarity, no Dividend Equivalent will be paid with respect to any PSUs that are forfeited.
7.Distribution of Shares. Except as provided otherwise in Section 3(e) (upon the death of the Participant) and Section 4(b) (upon the termination of the Award in conjunction with a Change in Control), and subject to the other provisions of this Agreement, the Company shall deliver to the Participant, as soon as reasonably practicable after the Vesting Date (but in all events within a payment window from February 1 to March 15 next following the final date of the Performance Period as set forth in Appendix A (the “Payment Window”)), one Share for each such PSU earned based on service-based and performance-based vesting. Upon the delivery of Shares, subject to any applicable holding period set forth in Appendix A, such Shares shall be fully assignable, alienable, saleable and transferrable by the Participant; provided that any such assignment, alienation, sale, transfer or other alienation with respect to such Shares shall be in accordance with applicable securities laws and any applicable Company policy. For avoidance of doubt, any PSUs that vest pursuant to Section 3(e) on the date of the Participant’s Termination of Service due to death will be settled as soon as reasonably practicable (and in no event later than 60 days) after the date of Termination of Service due to death.
8.Responsibility for Taxes.
(a)The Participant acknowledges that, regardless of any action taken by the Company, the ultimate liability for all income tax, social insurance, payroll tax, fringe benefits tax, payment on account or other tax-related items related to the Participant’s participation in the Plan and legally applicable to the Participant (“Tax-Related Items”) is and remains the Participant’s responsibility and may exceed the amount actually withheld by the Company. The Participant further acknowledges that the Company (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including, but not limited to, the grant, vesting or settlement of the Award, the subsequent sale of Shares acquired upon settlement of the Award and the receipt of any dividends and/or Dividend Equivalents;
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and (ii) does not commit to and is under no obligation to structure the terms of the grant or any aspect of the Award to reduce or eliminate the Participant’s liability for Tax-Related Items or achieve any particular tax result. Further, if the Participant is subject to Tax-Related Items in more than one jurisdiction, the Participant acknowledges that the Company may be required to withhold or account for Tax-Related Items in more than one jurisdiction.
(b)Prior to any relevant taxable or tax withholding event, as applicable, the Participant agrees to make adequate arrangements satisfactory to the Company to satisfy all Tax-Related Items. In this regard, the Participant authorizes the Company, or its respective agents, at its discretion, to satisfy any applicable withholding obligations with regard to all Tax-Related Items in the manner determined by the Company from time to time, which may include: (i) withholding from the Participant’s wages or other cash compensation paid to the Participant by the Company; (ii) requiring the Participant to remit the aggregate amount of such Tax-Related Items to the Company in full, in cash or by check, bank draft or money order payable to the order of the Company; (iii) through a procedure whereby the Participant delivers irrevocable instructions to a broker designated by the Committee to sell Shares obtained upon settlement of the Award and to deliver promptly to the Company an amount of the proceeds of such sale equal to the amount of the Tax-Related Items; (iv) by a “net settlement” under which the Company reduces the number of Shares issued on settlement of the Award by the number of Shares with an aggregate fair market value that equals the amount of the Tax-Related Items associated with such settlement; or (v) any other method of withholding determined by the Company and permitted by applicable law.
(c)Depending on the withholding method, the Company may withhold or account for Tax-Related Items by considering applicable minimum statutory withholding rates or other applicable withholding rates, including maximum applicable rates, in which case the Participant will receive a refund of any over-withheld amount in cash and will have no entitlement to the equivalent number of Shares. If the obligation for Tax-Related Items is satisfied by withholding in Shares, for tax purposes, the Participant is deemed to have been issued the full number of Shares subject to the settled Award, notwithstanding that a number of the Shares are held back solely for the purpose of paying the Tax-Related Items.
(d)Finally, the Participant agrees to pay to the Company any amount of Tax-Related Items that the Company may be required to withhold or account for as a result of the Participant’s participation in the Plan that cannot be satisfied by the means previously described. The Company may refuse to issue or deliver the Shares or the proceeds of the sale of Shares, if the Participant fails to comply with the Participant’s obligations in connection with the Tax-Related Items.
9.Not Salary, Pensionable Earnings or Base Pay. The Participant acknowledges that the Award shall not be included in or deemed to be a part of (a) salary, normal salary or other ordinary compensation, (b) any definition of pensionable or other earnings (however defined) for the purpose of calculating any benefits payable to or on behalf of the Participant
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under any pension, retirement, termination or dismissal indemnity, severance benefit, retirement indemnity or other benefit arrangement of the Company or any Affiliate or (c) any calculation of base pay or regular pay for any purpose.
10.Cancellation/Clawback. The Participant hereby acknowledges and agrees that the Participant and the Award are subject to the terms and conditions of Section 18 (Cancellation or “Clawback” of Awards) of the Plan.
11.Restrictive Covenant Agreement. As a condition to the Participant’s receipt of this grant of PSUs, the Participant acknowledges and agrees to and reaffirms all continuing obligations and duties the Participant has under any invention assignment, non-disclosure, non-competition, and/or non-solicitation agreement between the Participant and the Company, and any other obligations and duties which the Participant may have to: (a) safeguard the Company’s confidential information; (b) assign inventions to the Company; (c) avoid competing with the Company; or (d) avoid soliciting of the Company’s customers, suppliers, or employees. In addition to all such obligations and duties, the Participant further agrees to be bound by the obligations and duties set forth in Appendix B, Appendix C, or Appendix D hereto as applicable to the Participant based on the Participant’s state of residence. The RSUs granted to the Participant under this Award Agreement would not be granted to the Participant but for the Participant’s express agreement to and reaffirmation of such continuing obligations and duties, and this grant of RSUs shall constitute additional consideration for all such obligations and duties.
12.Provisions of Plan Control. This Agreement is subject to all the terms, conditions and provisions of the Plan, including the amendment provisions thereof, and to such rules, regulations and interpretations relating to the Plan as may be adopted by the Committee and as may be in effect from time to time. The Plan is incorporated herein by reference. If and to the extent that this Agreement conflicts or is inconsistent with the Plan, the Plan shall control, and this Agreement shall be deemed to be modified accordingly.
13.Notices. Any notice required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given when delivered personally or by courier, or sent by certified or registered mail, postage prepaid, return receipt requested, duly addressed to the party concerned at the address indicated below or to such changed address as such party may subsequently by similar process give notice of:
If to the Company:
Integer Holdings Corporation
Corporate Secretary, Integer Holdings Corporation 5830 Granite Parkway, Suite 1150, Plano, Texas 75024 Attention: General Counsel
If to the Participant, to the address of the Participant on file with the Company.
14.No Right to Continued Service. The grant of the Award shall not be construed as giving the Participant the right to be retained in the employ of, or to continue to provide services to, the Company or any Affiliate.
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15.No Right to Future Awards. Any Award granted under the Plan shall be a one-time Award that does not constitute a promise of future grants. The Company, in its sole discretion, maintains the right to make available future grants under the Plan.
16.Transfer of PSUs. Except as may be permitted by the Committee, neither the Award nor any right under the Award shall be assignable, alienable, saleable or transferable by the Participant other than (a) by will or pursuant to the laws of descent and distribution or (b) by order of any court of competent jurisdiction, including with respect to any domestic relations order or divorce decree. This provision shall not apply to any portion of the Award that has been fully settled and shall not preclude forfeiture of any portion of the Award in accordance with the terms herein.
17.Entire Agreement. This Agreement, the Plan and any other agreements, schedules, exhibits and other documents referred to herein or therein constitute the entire agreement and understanding between the parties in respect of the subject matter hereof and supersede all prior and contemporaneous arrangements, agreements and understandings, both oral and written, whether in term sheets, presentations or otherwise, between the parties with respect to the subject matter hereof.
18.Severability. If any provision of this Agreement is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction, or would disqualify the Plan or this Agreement under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended without, in the determination of the Committee, materially altering the intent of this Agreement, such provision shall be stricken as to such jurisdiction, and the remainder of this Agreement shall remain in full force and effect.
19.Amendment; Waiver. No amendment or modification of any provision of this Agreement that has a material adverse effect on the Participant shall be effective unless signed in writing by or on behalf of the Company and the Participant; provided that the Company may amend or modify this Agreement without the Participant’s consent in accordance with the provisions of the Plan or as otherwise set forth in this Agreement. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition, whether of like or different nature. Any amendment or modification of or to any provision of this Agreement, or any waiver of any provision of this Agreement, shall be effective only in the specific instance and for the specific purpose for which such amendment, modification or waiver is made or given, and, if applicable, shall be in accordance with the requirements of Section 409A of the Code.
20.Assignment. Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by the Participant.
21.Successors and Assigns; No Third-Party Beneficiaries. This Agreement shall inure to the benefit of and be binding upon the Company and the Participant and their respective Beneficiaries, successors, legal representatives and permitted assigns. Nothing in this Agreement, express or implied, is intended to confer on any Person other than the Company and
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the Participant, and their respective Beneficiaries, successors, legal representatives and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.
22.Dispute Resolution. All controversies and claims arising out of or relating to this Agreement, or the breach hereof, shall be settled by the Company’s mandatory dispute resolution procedures, if any, as may be in effect from time to time with respect to matters arising out of or relating to the Participant’s employment with the Company.
23.Governing Law; Venue. All matters arising out of or relating to this Agreement (other than Appendix B) and the transactions contemplated hereby, including its validity, interpretation, construction, performance and enforcement, shall be governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to its principles of conflict of laws. Appendix B shall be governed by Texas law, as described therein. For purposes of any action, lawsuit or other proceedings brought to enforce this Agreement, relating to it, or arising from it, the parties hereby submit to and consent to the sole and exclusive venue of the courts of Collin County, Texas, or the federal courts for the United States for the Eastern District of Texas, and no other courts.
24.Imposition of other Requirements and Participant Undertaking. The Company reserves the right to impose other requirements on the Participant’s participation in the Plan, on the Award and on any Shares to be issued upon settlement of the Award, to the extent the Company determines it is necessary or advisable for legal or administrative reasons. The Participant agrees to take whatever additional action and execute whatever additional documents the Company may deem necessary or advisable to accomplish the foregoing or to carry out or give effect to any of the obligations or restrictions imposed on either the Participant or the PSU pursuant to this Agreement.
25.References. References herein to rights and obligations of the Participant shall apply, where appropriate, to the Participant’s legal representative or Beneficiary without regard to whether specific reference to such legal representative or Beneficiary is contained in a particular provision of this Agreement.
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Acceptance, Acknowledgment and Receipt
By accepting this Agreement, I, the Participant, hereby:
●acknowledge and confirm my consent to receive electronically this Agreement, the Plan and any other Plan documents or other related communications that the Company wishes or is required to deliver;
●acknowledge that a copy of the Plan and the related Plan documents were made available to me;
●agree that the electronic acceptance of this Agreement constitutes a legally binding acceptance of this Agreement, and that the electronic acceptance of this Agreement shall have the same force and effect as if this Agreement was physically signed; and
●agree to be bound by the terms of this Agreement, including any Appendices attached hereto, and the Plan.
I acknowledge and agree that, if I have not accepted this Agreement within 75 days following the Grant Date, this Award will be forfeited in its entirety and I will not receive any compensation with respect to this Award.
AGREED TO:
| THE PARTICIPANT: | THE COMPANY: | |||||||||||||
| [Electronic Signature] | ||||||||||||||
| Name: | [Participant Name] | By: | ||||||||||||
| Date: | [Acceptance Date] | Date: | [Grant Date] | |||||||||||
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Appendix A
PARTICIPANT: [Participant Name]
Except as otherwise indicated, any capitalized term used but not defined herein shall have the meaning set forth in the Integer Holdings Corporation 2026 Omnibus Incentive Plan (as it may be amended from time to time, the “Plan”).
The Participant has been granted an Award of PSUs (sometimes referred to in this Appendix A as the “Financial Incentive Awards”) under the Plan, subject to the terms and conditions of the Plan and the Agreement.
Date of Grant: [Grant Date]
Grant Number: [Client Grant ID]
Target Number of PSUs: [Number of Awards Granted]
Vesting Schedule: Subject to Section 3(e) with respect to an earlier Termination of Service due to death prior to the final date of the Performance Period, the PSUs under this Agreement will vest on the date the Committee certifies the Company’s achievement of the Performance Metrics (as described below) following the final date of the Performance Period, with such certification to occur on or between ____________ and ____________.
Payment Window: ____________ – ____________ (with the specific payment date within the Payment Window to be determined by the Company following the Vesting Date).
Performance Period: The “Performance Period” is the three-year period ending on ____________ .
Performance Metrics:
Post-Vesting Holding
Period Lapse Date: ____________
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Appendix B
Restrictive Covenant Agreement
(Applicable to U.S. participants in all states except CA, MA, MN, MT, and OK)
As a condition to the Participant’s receipt of this grant of RSUs, the Participant covenants and agrees to abide by the following restrictive covenants, which shall be in addition to, rather than in lieu of, any other obligations that the Participant may have under any other confidentiality, invention assignment, non-disclosure, non-competition, and/or non-solicitation agreement or similar agreement between the Participant and Integer Holdings Corporation (the “Company”). Capitalized terms not otherwise defined in this Appendix B have the meanings ascribed to them in the Plan and the Agreement.
1.Restrictive Covenants.
a.Participant Acknowledgement. The Participant recognizes that the Integer Companies have invested significant time and resources to train employees and develop the Confidential Information and to establish substantial relationships and goodwill with the Integer Companies’ current and prospective business relationships. The Participant acknowledges and agrees that the highly competitive nature of the Integer Companies’ business, the Participant’s key position with the Integer Companies, and the Confidential Information, company relationships, specialized training, and association with goodwill provided to the Participant during the Employment Period support and make necessary the reasonable promises from the Participant in this Section 1 and also support the Participant’s duty of loyalty and other fiduciary obligations to the Integer Companies under applicable state law.
b.Confidential Information. In the course of the Participant’s employment with the Integer Companies and the performance of the Participant’s duties on behalf of the Integer Companies, the Participant will be provided with, and will have access to, Confidential Information. Both during the Employment Period and thereafter, except as expressly permitted by this Agreement, the Participant shall not disclose any Confidential Information to any Person and shall not use any Confidential Information except for the benefit of the Integer Companies. The Participant acknowledges and agrees that the Participant would inevitably use and disclose Confidential Information in violation of this Section 1(b) if the Participant were to violate any of the covenants set forth in this Section 1. The Participant shall follow all policies and protocols of the Integer Companies regarding the security of all documents and other materials containing Confidential Information (regardless of the medium on which Confidential Information is stored). The Participant understands and acknowledges that the Participant’s obligations under this Agreement with regard to any particular Confidential Information shall commence immediately upon the Participant first having access to such Confidential Information and shall continue during and after the Employment Period until such time as such Confidential Information has become public knowledge other than as a
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result of the Participant’s breach of this Agreement or breach by those acting in concert with the Participant or on the Participant’s behalf.
c.Protected Activities. Notwithstanding the foregoing Section 1(b), nothing in this Agreement shall prohibit or restrict the Participant from lawfully (i) initiating communications directly with, cooperating with, providing information to, causing information to be provided to, or otherwise assisting in an investigation by, any governmental authority (including, without limitation the Equal Employment Opportunity Commission, the National Labor Relations Board, the Department of Labor, or the Securities and Exchange Commission (the “SEC”)) regarding a possible violation of any law, (ii) responding to any inquiry or legal process directed to the Participant from any such governmental authority, (iii) testifying, participating or otherwise assisting in any action or proceeding by any such governmental authority relating to a possible violation of law, or (iv) making any other disclosures that are protected under the whistleblower provisions of any applicable law. Additionally, pursuant to the federal Defend Trade Secrets Act of 2016, an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (A) is made (1) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney and (2) solely for the purpose of reporting or investigating a suspected violation of law, (B) is made to the individual’s attorney in relation to a lawsuit for retaliation against the individual for reporting a suspected violation of law, or (C) is made in a complaint or other document filed in a lawsuit or proceeding, if such filing is made under seal. Nothing in this Agreement requires the Participant to obtain prior authorization before engaging in any conduct described in this Section 1(c) or to notify the Integer Companies that the Participant has engaged in any such conduct. Further, nothing herein restricts the Participant’s ability to collect an award in connection with a report or disclosure to the SEC or any other governmental agency.
d.Restriction on Competitive Activity. As a key employee of the Integer Companies who will, by virtue of the Participant’s employment with the Integer Companies, have access to Confidential Information, the Participant recognizes that it would cause irreparable harm to the Integer Companies if the Participant were to provide services in employment or business that are unfairly competitive with the business of the Integer Companies. Accordingly, the Participant agrees that the Participant will not, and will not attempt to, at any time during the Employment Period and thereafter during the Restricted Period: (i) directly or indirectly invest in, own, manage, operate, finance, control or participate in the ownership, management, operation, financing, or control of any Competing Business or (ii) be employed or engaged by, or otherwise associated with, any Competing Business. The foregoing notwithstanding: (A) if the Participant resides in New York and the Participant’s employment is terminated by the Integer Companies without Cause, then the restrictions in this Section 1(d) shall only apply during the Employment Period; (B) during the Restricted Period, (1) the Participant’s obligations under this Section 1(d) shall only restrict the Participant’s activities insomuch as Participant’s activities
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and/or the applicable business activities of the Competing Business (in either case, whether actual or planned) (x) occur at a physical location within the Restricted Territory or (y) are aimed or directed at, target, or reach into the Restricted Territory, regardless of the physical location from which such activities emanate, and (2) the Participant’s obligations under Section 1(d)(ii) shall not exclude Participant from any role for which there is no possible use of the Confidential Information to provide a business advantage to the Competing Business. Nothing in this Section 1(d) shall restrict Participant from owning up to five percent (5%) of any class of securities of any enterprise (but without otherwise participating in the management or activities of such enterprise) if such securities are listed on any national or regional securities exchange or have been registered under Section 12(g) of the Exchange Act.
e.Customer Non-Solicitation. The Participant agrees that, during the Employment Period and thereafter during the Restricted Period, the Participant will not, either directly or indirectly, alone or in conjunction with any other Person (other than the Integer Companies) (i) solicit or do business with any Restricted Customer for the benefit of a Competing Business or (ii) in any other manner attempt to influence, induce, or encourage any Restricted Customer to discontinue or change, in a manner adverse to the Integer Companies, its relationship or business with, or purchases or orders from, the Integer Companies, including by ceasing, not increasing, or decreasing the volume of business the Restricted Customer provides to the Integer Companies. During the Restricted Period, the Participant’s obligations under this Section 1(e) shall only apply to those Restricted Customers for whom the Participant had responsibility or involvement (directly or indirectly) and received Confidential Information about during the Look-Back Period.
f.Employee Non-Solicitation. The Participant agrees that, during the Employment Period and thereafter during the Restricted Period, the Participant will not, either directly or indirectly, alone or in conjunction with any other Person (other than the Integer Companies): (i) solicit, hire, retain or seek to hire or retain any Restricted Service Provider or (ii) in any other manner attempt to influence, induce, or encourage any such Restricted Service Provider to terminate, reduce or materially change in a manner adverse to the Integer Companies, such Restricted Service Provider’s employment or other business relationship with the Integer Companies. During the Restricted Period, the Participant’s obligations under this Section 1(d) shall only apply to those Restricted Service Providers for whom the Participant had responsibility or involvement (directly or indirectly) and received Confidential Information about during the Look-Back Period.
g.Request for Confirmation. The Company agrees that during the Restricted Period, on a case-by-case basis, it will consider a request by the Participant to confirm whether the Company considers a prospective new employer of the Participant (a “New Employer”) to be a Competing Business as of the date of the request. The foregoing shall not apply unless the Participant provides the Company with such written request in writing, including the name and address of New Employer and
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details about the prospective position to be held by the Participant at least 30 calendar days prior to commencing employment with New Employer. Further, upon request, the Company will confirm the geographic scope of the Restricted Territory as of the time of the request.
h.Tolling. Should the Participant violate any of the terms of the restrictive covenant obligations contained in this Section 1, the parties agree that a court of competent jurisdiction shall have the power to extend the obligation(s) at issue to run from the first date on which the Participant ceases to be in violation of such obligation(s).
i.Definitions. For purposes of this Appendix B, the following definitions apply.
i.“Cause” shall mean any reasonable basis for discharge of the Participant’s employment by the Integer Companies that is directly related to the Participant’s conduct, including the Participant’s conduct on the job or otherwise, job performance, and contract or employment record.
ii.“Company Business” means (A) the design, development, manufacture, assembly, sale and provision of medical devices in the cardio and vascular, neuromodulation, and cardiac rhythm management markets and/or (B) any other business activities engaged in by the Integer Companies during the Employment Period. However, Company Business shall not include any business activities for which the Participant had no responsibility, management or involvement and about which the Participant had no access to Confidential Information during the Look-Back Period.
iii.“Competing Business” means a Person (other than the Integer Companies) that engages in, or actively plans to engage in, any business and/or activities that are the same as, substantially similar to, or the functional equivalent of the Company Business and that competes, in whole or in part, with the Company Business.
iv.“Confidential Information” means any information pertaining to the business and operations of the Integer Companies that is not generally available to the public and that is used, developed or obtained by the Integer Companies in connection with its business, including, without limitation, any proprietary information; financial information and projections; business strategies; information about products or services; fees, costs and pricing information; designs, analysis, drawings, computer software, including operating systems, applications and program listings; ; accounting and business methods; inventions, devices, new developments, methods, and processes, whether patentable or unpatentable and whether or not reduced to practice; customers and clients and customer or client lists and preferences; employee information; copyrightable works; all technology and trade secrets; information regarding lines of business; and all similar and related information in whatever form.
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v.“Employment Period” means the period during which the Participant is employed with or otherwise engaged by the Integer Companies.
vi.“Integer Companies” means the Company, its current subsidiaries, affiliates, and any additional corporation, partnership, limited liability company, joint venture or other business entity that becomes a subsidiary or affiliate of the Company during the Participant’s employment or engagement with the Company.
vii.“Look-Back Period” means the 12-month period immediately preceding the last day of the Employment Period.
viii.“Person” means an individual, firm, corporation, partnership, association, limited liability company, trust or any other entity.
ix.“Restricted Customer” means any Person who (A) is a customer or client of the Integer Companies (or was at any time during the Look-Back Period) or (B) was actively and materially contacted or solicited (directly or indirectly) by the Integer Companies for the purpose of becoming a customer or client of the Integer Companies.
x.“Restricted Period” means the period commencing on the last day of the Employment Period and continuing until the expiration of 12 months therefrom.
xi.“Restricted Service Provider” means any Person who is (or at any time during the Look-Back Period was) employed by or engaged to perform personal services as an independent contractor or consultant for the Integer Companies.
xii.“Restricted Territory” means any county, parish, borough or foreign equivalent, as applicable, within North America, South America, Europe, and/or the Asian Pacific (each, a “Geographic Area”) in which (i) the Integer Companies have, or had during the Look-Back Period, conducted business or written plans to conduct business; (ii) the Integer Companies have, or had during the Look-Back Period, customers or clients; and (iii) the Integer Companies have, or had during the Look-Back Period, an office or facility. However, Restricted Territory shall not include any Geographic Area in which the Participant had no responsibility, no management and no involvement and about which the Participant had no access to Confidential Information, in each case, at any time during the Look-Back Period.
2.Reasonableness of Limitations. The Participant represents and agrees that the restrictive covenants contained herein are reasonable in time, geography, and the scope of activities restricted and no broader than necessary for the protection of the Integer Companies’ legitimate business interests. Participant agrees that in the event that any such territorial, time, or other limitation is found to be unreasonable or overbroad by a court of competent
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jurisdiction, the Participant agrees (a) to the reduction of any said territorial, time, or other limitation, or all of them, to the maximum area, period or scope as such court may determine to be reasonable and (b) that all of the other provisions of this Appendix B shall remain valid, binding and in full force and effect. The Participant acknowledges and understands that the Participant’s promises in Section 1 restrict some of the Participant’s actions during and after employment with the Integer Companies but will not operate to impose an undue hardship upon the Participant and will not prevent the Participant from supporting themselves after separation of employment from the Integer Companies.
3.Consideration. The Participant acknowledges and agrees that they have or will receive sufficient consideration from the Integer Companies in exchange for and to justify the restrictions contained in Section 1, including, without limitation, receipt of the RSUs and access and the opportunity to develop the Integer Companies’ Confidential Information, valuable customer and client relationships, and goodwill.
4.Relief. The Participant acknowledges and agrees that a violation of the restrictions contained in Section 1 of this Appendix B would result in irreparable injury to the Integer Companies for which there would be no adequate remedy at law and, therefore, if the Participant violates, or attempts to violate, any of these restrictions, the Participant consents to any of the Integer Companies seeking an injunction or other equitable relief to prevent the Participant from such violation or attempted violation, in addition to, and not in lieu of, all other remedies available to the Integer Companies in equity or at law. Participant agrees that such injunctive relief may be granted without the requirement that the Integer Companies post a bond or any security (or where such a bond or security is required by law, Participant agrees that a bond of $1,000 shall be sufficient security to support any such injunctive relief).
5.Survival. All of the Participant’s obligations under this Appendix B will survive the termination of the Participant’s employment with the Integer Companies, regardless of the circumstances of or reason(s) for such termination.
6.Severability. If it is determined by any unit, department or agency of government having jurisdiction, whether federal, state or local, or by a court of competent jurisdiction that any portion of this Appendix B is invalid or unenforceable such determination shall not affect the validity or enforceability of the remainder of this Appendix B or any valid clause of an invalid portion of this Appendix B; and if a restriction provided for in this Appendix B is found by a court of competent jurisdiction to be unenforceable as written, the court shall revise the restriction so as to make it enforceable to protect the Integer Companies’ legitimate interest. In this regard, the parties expressly authorize the court to apply, create or modify time, scope or geographic restrictions as needed to make this Appendix B enforceable.
7.Governing Law; Venue. All matters arising out of or relating to this Appendix B, including its validity, interpretation, construction, performance and enforcement, shall be governed by and construed in accordance with the internal laws of the State of Texas without giving
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effect to its principles of conflict of laws. The parties agree that any action, lawsuit or other proceedings relating to, arising out of, or to enforce this Appendix B shall be brought solely in the Texas state district courts for Collin County, Texas or, to the extent any such action is within the subject matter jurisdiction of the federal courts, in the United States District Court for the Eastern District of Texas, and, in each case, in the appellate courts having jurisdiction over such courts. The parties agree that such courts shall be the exclusive venue for any action, lawsuit or other proceedings relating to, arising out of or to enforce this Appendix B and hereby irrevocably consent to and waive any challenge to such courts’ exercise of personal jurisdiction over the parties or venue.
8.Participants in Florida. To the extent that Florida law is deemed to apply to this Appendix B, the Participant is hereby advised that the Participant has the right to consult an attorney prior to executing this Appendix B. The Participant shall have seven (7) days to review this Appendix B prior to signing, but the Participant is not required to take the full seven (7) days and may sign this Appendix B sooner if the Participant so chooses.
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Appendix C
Non-Competition Covenant
(Applicable to participants in MA)
As a condition to the Participant’s receipt of this grant of RSUs, the Participant covenants and agrees to abide by the following Non-Competition covenant, which supersedes and replaces entirely any prior inconsistent Non-Competition covenant that the Participant may have under any invention assignment, non-disclosure, non-competition, and/or non-solicitation agreement or similar agreement between the Participant and the Company; provided, however, nothing herein shall prevent Participant from engaging in the practice of law. Capitalized terms not otherwise defined in the Plan have the meanings set forth in Section 1(e) of this Appendix C.
1.Non-Competition.
a.Restriction on Competitive Activity. As a key employee of the Company who will, by virtue of the Participant’s employment with the Company, have access to Confidential Information, the Participant recognizes that it would cause irreparable harm to the Integer Companies if the Participant were to engage in employment or business that is unfairly competitive with the business of the Integer Companies. Accordingly, the Participant agrees that during the Non-Compete Period, the Participant will not, either directly or indirectly, alone or in conjunction with any other person or entity (other than the Integer Companies), engage in any Prohibited Activity.
b.Prohibited Activity. The Participant acknowledges and agrees that the job duties the Participant performs for the Company affect the Integer Companies throughout their sales territory. Prohibited Activity also includes activity that may require or inevitably require disclosure of Confidential Information.
c.Request for Confirmation. The Company agrees that during the Non-Compete Period, on a case-by-case basis, it will consider a request by the Participant to confirm whether the Company considers a prospective new employer of the Participant’s (a “New Employer”) to be a “Direct Competitor” as of the date of the request. The foregoing shall not apply unless the Participant provides the Company with such written request in writing, including the name and address of New Employer, and details about the prospective position to be held by the Participant at least thirty (30) calendar days prior to commencing employment with New Employer.
d.Tolling. Should the Participant violate any of the terms of the restrictive covenant obligations contained in this Section 1, the obligation at issue will run from the first date on which the Participant ceases to be in violation of such obligation.
e.Definitions. For purposes of this Appendix C, the following definitions apply.
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i.“Confidential Information” means any information pertaining to the business and operations of the Integer Companies that is not generally available to the public and that is used, developed, or obtained by any of the Integer Companies in connection with its business, including any proprietary information and (A) financial information and projections, (B) business strategies, (C) products or services, (D) fees, costs and pricing structures, (E) designs, (F) analysis, (G) drawings, photographs and reports, (H) computer software, including operating systems, applications and program listings, (I) flow charts, manuals and documentation, (J) data bases, (K) accounting and business methods, (L) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice, (M) patients, customers and clients and patient, customer or client lists, (N) copyrightable works, (O) all technology and trade secrets, (P) product categories or lines of business, and (Q) all similar and related information in whatever form.
ii.“Direct Competitor” means, with respect to each Restricted Product Category, a non-Integer Company entity or person (including an Associate or an entity owned in whole or in part by an Associate) that engages in a line of business that is the same as or similar to or which competes, in whole or in part, with such Restricted Product Category.
iii.“Integer Companies” means the Company, its current subsidiaries, affiliates and any additional corporation, partnership, limited liability company, joint venture or other business entity that becomes a subsidiary or affiliate of Integer in the future.
iv.“Non-Compete Period” means twelve consecutive months immediately following the date that the Participant’s employment with the Company terminated (1) with Cause, (2) pursuant to the Participant’s voluntary resignation (including retirement) or (3) or such shorter period as designated by the Company in writing in its sole discretion, during which time the Participant shall be entitled to any post-employment consideration which the Company determines, in its discretion, to pay to the Participant.
v.“Prohibited Activity” means performance of any duties that are:
1.substantially similar to or the same as those which the Participant performed in connection with the Participant’s employment with any Integer Company; and
2.either (A) directly or indirectly relating to or otherwise competitive with any Restricted Product Category products or lines of business; or (B) in any other capacity not limited by product category or line of business within the Integer Companies (e.g., associates who perform corporate functions); and
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3.for or on behalf of either: (A) any Direct Competitor; or (B) any other person or entity that offers, or plans to offer, products or services that are competitive with the products or services provided by, or under development by, any of the Integer Companies.
In any case, an activity is not a Prohibited Activity unless it is performed anywhere in the sales territory of the Integer Companies.
vi.“Restricted Product Category” means any or all of the following product categories or lines of business within the Integer Companies to which the Participant provided services or support, or had access to Confidential Information, during the Participant’s employment: (1) Cardiac Rhythm Management and Neuromodulation; (2) Cardio & Vascular; (3) Power Solutions; or (4) Electrochem. For avoidance of doubt, associates whose work is not limited by product category or line of business, e.g. associates who perform corporate functions, shall be deemed to have provided services or support, or had access to Confidential Information during employment, relating to all product categories and lines of business within the Integer Companies.
2.Reasonableness of Limitations. The Participant represents and agrees that the restrictive covenants contained in herein are necessary for the protection of the Company’s legitimate business interests and are reasonable in scope and content; the territorial, time and other limitations of this Appendix C are reasonable and properly required for the adequate protection of the business and affairs of the Company, and, in the event that any such territorial, time or other limitation is found to be unreasonable by a court of competent jurisdiction, the Participant agrees (a) to the reduction of any said territorial, time or other limitation, or all of them, to the maximum area, period or scope as such court may determine to be reasonable and (b) that all of the other provisions of this Appendix C shall remain valid, binding and in full force and effect. The Participant has been advised of the Participant’s right to consult with legal counsel regarding this Appendix C and the restrictive covenants contained herein and have been afforded an adequate opportunity to do so. This Appendix C is effective ten (10) days after the Agreement, with Appendix C attached, has been provided to the Participant. The Participant has been advised of the Participant’s right to consult with legal counsel regarding this Appendix C and the restrictive covenants contained herein and have been afforded an adequate opportunity to do so.
3.Relief. The Participant acknowledges and agrees that a violation of the restrictions contained in Sections 1 of this Appendix C would result in irreparable injury to the Integer Companies for which there would be no adequate remedy at law and, therefore, if the Participant violates, or attempts to violate, any of these restrictions, the Participant consents to any of the Integer Companies’ seeking an injunction or other equitable relief to prevent the Participant from such violation or attempted violation, in addition to, and not in lieu of, all other remedies available to the Integer Companies in equity or at law.
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4.Survival. All of the Participant’s obligations under this Appendix C will survive the termination of the Participant’s employment with the Company, regardless of the circumstances of or reason(s) for such termination.
5.Severability. If it is determined by any unit, department or agency of government having jurisdiction, whether federal, state or local, or by a court of competent jurisdiction, that any portion of this Appendix C is invalid, or unenforceable, such determination shall not affect the validity or enforceability of the remainder of this Appendix C or any valid clause of an invalid portion of this Appendix C; and if a restriction provided for in this Appendix C is found by a court of competent jurisdiction to be unenforceable as written, the court shall revise the restriction so as to make it enforceable to protect the Integer Company’s legitimate interest. In this regard, the parties expressly authorize the court to apply, create or modify time, scope or geographic restrictions as needed to make this Appendix C enforceable.
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Appendix D
Restrictive Covenant Agreement
(Applicable to participants in CA, MN, MT, and OK)
No further restrictions apply to the Participant.
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INTEGER HOLDINGS CORPORATION
AMENDED AND RESTATED CHANGE OF CONTROL AGREEMENT
This AMENDED AND RESTATED CHANGE OF CONTROL AGREEMENT is by and between Integer Holdings Corporation, a Delaware corporation (“Integer”), and _________________ (the “Executive”), and dated as of the ______ day of _____ 2026.
The Board of Directors of Integer (the “Board’’) has determined that it is in the best interests of Integer and its stockholders to assure that the Company (as defined below) will have the continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change of Control (as defined below). The Board believes it is imperative to (1) diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change of Control; (2) encourage the Executive’s full attention and dedication to the Company currently and in the event of any threatened or pending Change of Control; and (3) to enable the Executive, without being influenced by the uncertainties of the Executive’s own situation, to assess and advise Integer whether proposals concerning any potential Change of Control are in the best interests of Integer and its stockholders and to take other action regarding these proposals as Integer might determine appropriate. Therefore, to accomplish these objectives, the Board has caused Integer to enter into this Agreement, which amends and restates the Change of Control Agreement by and between Integer and the Executive and dated as of March 24, 2025 (the “Prior Agreement”).
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Certain Definitions.
(a) An “Affiliate” of, or a Person “Affiliated” with, a specified Person, means a Person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the Person specified.
(b) “Beneficial Owner” has the meaning ascribed to such term in Rule 13d-3 under the Exchange Act.
(c) “Cause” means (i) a material breach by the Executive of this Agreement, (ii) gross negligence or willful misconduct in the performance of the Executive’s duties to the Company, (iii) the Executive’s continued and willful failure or refusal (other than due to Disability) to perform the Executive’s material duties to the Company, (iv) the Executive’s willful or gross misconduct, whether or not in connection with the Executive’s duties to the Company, that is likely to materially injure the reputation, business or a business relationship of the Company, (v) the commission of a felony that results in a conviction or nolo contendre plea in a court of law, or (vi) a material violation of the written policies of the Company. Other than in the case of an act described in clause (v), the cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of the resolution duly adopted by the affirmative vote of not less than 3/4ths of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive and the Executive is given an opportunity, together with counsel, to be
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heard before the Board), finding that, in the good faith opinion of the Board, the Executive is guilty of the conduct described in this Section, and specifying the particulars in detail.
(d) “Change of Control Period” means the consecutive 24-month period following the consummation of a Change of Control.
(e) “Code” means the Internal Revenue Code of 1986, as amended.
(f) “Company” means, collectively, Integer and its Subsidiaries except where the context clearly requires otherwise.
(g) “Confidential Information” means oral or written knowledge and information not generally known whether presently existing or developed in the future, including trade secrets, about the Integer Companies’ methods, processes, technology, intellectual property, products and services, including but not limited to information relating to such matters as research and development, inventions, designs, formulas, configurations, engineering drawings, studies, plans, specifications or components pertaining to or used in connection with any and all computer software or hardware products, contemplated, under development or developed (in whole or in part) by any of the Integer Companies, manufacturing methods, patents, inventions, processes, techniques, composition of materials, applications for particular technologies, materials or designs, business relationships of any of the Integer Companies (including proposed relationships with suppliers, distributors, licensees and licensors), vendor names, customer lists, management systems, financial data, financial statements and sales and marketing plans. All information which the Executive acquires or becomes acquainted with during employment with any of the Integer Companies that relates to the Integer Companies or their businesses, whether developed by the Executive or by others, which the Executive has a reasonable basis to believe to be confidential information of the Integer Companies, or which is treated by the Integer Companies as being confidential, will be presumed to be Confidential Information. The term “Confidential Information” does not include information which is or becomes generally available to the public other than as a result of a disclosure by the Executive or Executive’s agents or other representatives.
(h) “Direct Competitor” means, with respect to each Restricted Product Category, a non-Integer Company Person (including the Executive or a Person owned in whole or in part by the Executive) that engages in a line of business that is the same as or similar to or which competes, in whole or in part, with such Restricted Product Category.
(i) “Disability” means the failure of the Executive to perform the Executive’s duties to the Company on a full-time basis for 180 consecutive business days as a result of incapacity due to mental or physical illness which is determined to be total and permanent. Any question as to the date of or the existence, extent or potentiality of disability of the Executive on which the Executive and Integer cannot agree shall be determined by a qualified independent physician jointly selected by the Executive and Integer (or if the Executive is unable to make such a selection, it shall be made by an adult member of the Executive’s immediate family). The determination of such physician, made in writing to Integer and to the Executive, shall be final and conclusive.
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(j) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and the rules, regulations and guidance thereunder. Any reference to a provision in the Exchange Act shall include any successor provision thereto.
(k) “Good Reason” means the occurrence of any of the following events or conditions without the Executive’s written consent:
(i) a diminution in the Executive’s annual base salary from that in effect immediately prior to the Change of Control;
(ii) a reduction in the Executive’s annual or long-term incentive opportunity from that in effect immediately prior to the Change of Control;
(iii) a material diminution in the Executive’s authority, duties, or responsibilities from those in effect immediately prior to the Change of Control;
(iv) the relocation of the principal office at which the Executive performs services for the Company by more than 35 miles from the location of such office immediately prior to the Change of Control, provided that such relocation results in a material increase in the Executive’s commuting time;
(v) the failure of Integer to obtain the agreement of any successor of Integer to assume this Agreement in accordance with Section 15(c); or
(vi) any other action or inaction that constitutes a material breach by the Company of this Agreement.
“Good Reason” shall not be deemed to exist unless: (A) the Executive has provided written notice to Integer of the existence of one or more of the conditions listed in (i) through (vi) above within 90 days after the initial existence of such condition or conditions; and (B) such condition or conditions have not been cured by Integer within 30 days after receipt of such notice.
(l) “Integer Companies” means Integer, its current Subsidiaries, and any additional corporation, partnership, limited liability company, joint venture or other business entity which becomes a Subsidiary of Integer.
(m) “Non-Compete Period” means the period of the Executive’s employment with the Integer Companies and, in the event the Executive receives the payments and benefits provided for in Section 5(d), for 12 months after the Termination Date.
(n) “Person” has the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) thereof. Notwithstanding the foregoing, for purposes of Section 10, “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than the Integer Companies.
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(o) “Prohibited Activity” means performance of any duties that are (i) substantially similar to or the same as those performed by the Executive in connection with Executive’s employment with the Integer Companies; (ii) directly or indirectly relating to or otherwise competitive with any Restricted Product Category products or lines of business; and (iii) for or on behalf of either (1) any Direct Competitor, or (2) any other Person that offers, or plans to offer, products or services that are competitive with the products or services provided by, or under development by, any of the Integer Companies. Notwithstanding the foregoing, an activity shall not be a Prohibited Activity unless it is performed anywhere in the sales territory of the Integer Companies. The Executive acknowledges and agrees that the job duties performed by the Executive for the Integer Companies affect the Integer Companies throughout their sales territory.
(p) “Restricted Product Category” means any or all of the following product categories or lines of business within the Integer Companies to which the Executive provides services or support, or had access to Confidential Information, during the Executive’s employment: (1) Cardiac Rhythm Management and Neuromodulation; (2) Cardio & Vascular; or (3) any other product category or line of business that the Integer Companies become involved in during the period of the Executive’s employment with the Integer Companies. For avoidance of doubt, if the Executive’s work is not limited by product category or line of business, e.g. performance of corporate functions, the Executive shall be deemed to have provided services or support, or had access to Confidential Information during employment, relating to all product categories and lines of business within the Integer Companies.
(q) “Specified Employee” means an employee who is a “specified employee,” as defined in Section 409A of the Code, on the date of the employee’s Termination of Employment.
(r) “Subsidiary” means any corporation, limited liability company, partnership or other entity in which Integer holds, directly or indirectly, a majority of the value of the outstanding equity securities or a majority of the voting power with respect to the voting securities of such entity.
(s) “Termination Date” means the date the Executive incurs a Termination of Employment with the Company other than on account of death.
(t) “Termination of Employment,” “separation from service” and terms of similar import mean a “separation from service” within the meaning of Section 409A(a)(2)(A)(i) of the Code.
2. Change of Control. “Change of Control” means:
(a) Any Person, other than any employee plan established by the Integer Companies, the Integer Companies, an underwriter temporarily holding securities pursuant to an offering of such securities, or an entity owned, directly or indirectly, by stockholders of Integer in substantially the same proportions as their ownership of Integer, is (or becomes, during any 12-month period) the Beneficial Owner, directly or indirectly, of securities of Integer (not including in the securities beneficially owned by such Person any securities acquired directly from the Integer Companies other than in connection with the acquisition by the Integer Companies of a business)
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representing 50% or more of the total voting power of the stock of Integer; provided that the provisions of this subsection (a) are not intended to apply to or include as a Change of Control any transaction that is specifically excepted from the definition of Change of Control under subsection (c) below;
(b) a change in the composition of the Board such that, during any 12-month period, the individuals who, as of the beginning of such period, constitute the Board (the “Existing Board”) cease for any reason to constitute at least 50% of the Board; provided, however, that any individual becoming a member of the Board subsequent to the beginning of such period whose election, or nomination for election by Integer’s stockholders, was approved by a vote of at least a majority of the members of the Board immediately prior to the date of such appointment or election shall be considered as though such individual were a member of the Existing Board; provided further, that, notwithstanding the foregoing, no individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 or Regulation 14A promulgated under the Exchange Act or successor statutes or rules containing analogous concepts) or other actual or threatened solicitation of proxies or consents by or on behalf of an individual, corporation, partnership, group, associate or other entity or Person other than the Board, shall in any event be considered to be a member of the Existing Board;
(c) the consummation of a merger, amalgamation or consolidation of Integer with any other corporation or other entity, or the issuance of voting securities in connection with such a transaction pursuant to applicable stock exchange requirements; provided that immediately following such transaction the voting securities of Integer outstanding immediately prior thereto do not continue to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity of such transaction or parent entity thereof) 50% or more of the total voting power and total fair market value of Integer’s stock (or, if Integer is not the surviving entity of such merger or consolidation, 50% or more of the total voting power and total fair market value of the stock of such surviving entity or parent entity thereof); and provided, further, that such a transaction effected to implement a recapitalization of Integer (or similar transaction) in which no Person is or becomes the Beneficial Owner, directly or indirectly, of securities of Integer (not including in the securities beneficially owned by such Person any securities acquired directly from the Integer Companies other than in connection with the acquisition by the Integer Companies of a business) representing 50% or more of either the then-outstanding common stock in Integer or the combined voting power and total fair market value of Integer’s then-outstanding voting securities shall not be considered a Change of Control; or
(d) the sale or disposition by Integer of all or substantially all of Integer’s assets in which any Person acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such Person) assets from Integer that have a total gross fair market value equal to more than 50% of the total gross fair market value of all of the assets of Integer immediately prior to such acquisition or acquisitions.
Notwithstanding the foregoing, (i) no Change of Control shall be deemed to have occurred if there is consummated any transaction or series of integrated transactions immediately
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following which the record holders of the shares of common stock in Integer immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in an entity which owns substantially all of the assets of Integer immediately prior to such transaction or series of transactions and (ii) no Change of Control shall be deemed to have occurred upon the acquisition of additional control of Integer by any Person that is considered to effectively control Integer. In no event will a Change of Control be deemed to have occurred if the Executive is part of a “group” within the meaning of Section 13(d)(3) of the Exchange Act that effects a Change of Control. Notwithstanding any other provision of this Agreement, to the extent necessary to comply with Section 409A of the Code, a “Change of Control” will be considered to have occurred only if the event constitutes a change in control event under Section 409A of the Code.
3. Term of Agreement. This Agreement will be effective from the date hereof and continue in effect for an indefinite term, subject to termination in accordance with the terms and conditions of this Agreement.
4. Cause and Good Reason Termination Procedures. Any termination of the Executive’s employment by the Company for Cause or by the Executive for Good Reason during the Change of Control Period shall be communicated through a written notice to the other party. A written notice will (i) indicate the specific termination provision in this Agreement relied upon, (ii) set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, and (iii) if the Termination Date is other than the date of receipt of such notice, specifies the Termination Date (which shall be not more than 15 days after the giving of such notice in all instances other than Good Reason, in which case it shall be at least 31 days after and no more than 90 days after the provision of the written notice). The failure by the Executive or Integer to set forth in the written notice any fact or circumstance that contributes to a showing of Good Reason or Cause, as the case may be, shall not waive any right of the Executive or Integer or preclude the Executive or Integer from asserting such fact or circumstance in enforcing the Executive’s or Integer’s rights.
5. Obligations of the Company upon Termination.
(a) Death. If the Executive’s employment terminates by reason of the Executive’s death during the Change of Control Period, the Company shall have no further obligations to the Executive’s legal representatives under this Agreement, other than the following obligations (the amounts described in clauses (i) and (ii) are the “Accrued Obligations”):
(i) payment of the Executive’s base salary through the date of the Executive’s death to the extent not paid; and
(ii) payment of any earned but unpaid annual bonus for the most recently completed fiscal year.
All Accrued Obligations shall be paid to the Executive’s estate or beneficiary, as applicable, in a lump sum in cash within 30 days following the date of the Executive’s death.
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(b) Disability. If the Executive’s employment is terminated by reason of the Executive’s Disability during the Change of Control Period, the Company shall have no further obligations to the Executive, other than for the Accrued Obligations. All Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days following the Termination Date.
(c) Cause or Voluntary Resignation. If the Executive’s employment is terminated by the Company for Cause during the Change of Control Period, the Company shall have no further obligations to the Executive, other than the obligation to pay to the Executive the Executive’s base salary through the Termination Date to the extent unpaid. If the Executive voluntarily terminates employment with the Company during the Change of Control Period, excluding a termination for Good Reason, the Company shall have no further obligations to the Executive, other than for the Accrued Obligations. Any amounts payable to the Executive under this Section 5(c) shall be paid to the Executive in a lump sum in cash within 30 days following the Termination Date.
(d) Other Termination: Good Reason. If, during the Change of Control Period, the Company shall terminate the Executive’s employment other than for Cause or Disability, or the Executive shall voluntarily terminate employment with the Company for Good Reason:
(i) The Company shall pay to the Executive the following amounts within 30 days following the Termination Date:
A. all Accrued Obligations;
B. a lump sum payment equal to two times the sum of (i) the Executive’s annual base salary and (ii) the higher of (x) the average annualized (for any fiscal year consisting of less than 12 full months or with respect to which the Executive has been employed by the Company for less than 12 full months) bonus paid for the three fiscal years immediately preceding the fiscal year in which the Change of Control occurs, or (y) the Executive’s target annual bonus opportunity pursuant to any annual bonus plan in effect for the fiscal year that includes the Termination Date;
C. a lump sum payment equal to two times the Company’s total contributions on behalf of the Executive to any retirement plan (whether qualified or nonqualified) of the Company in effect on the Termination Date, for the plan year preceding the Termination Date. This payment will be made in cash and will not eliminate the obligation of the Company to make all scheduled contributions to any retirement plan;
D. a separate lump sum payment equal to the product of (x) 110 percent of the monthly premium (or the equivalent cost of coverage for self-insured benefits) for medical and prescription drug coverage for the most recent complete month of medical and prescription drug coverage for Executive, Executive’s spouse (if any) and dependent children who were covered under the Company’s medical and prescription drug plans immediately prior to the Termination Date and (y) twenty-four (24);
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(ii) the Company shall pay the Executive up to $25,000 for executive outplacement services utilized by the Executive; provided however, that such expenses shall be paid or reimbursed to the Executive by the Company on a regular, periodic basis no later than 30 days after presentation by the Executive of a statement or statements, up to a maximum of $15,000 in the first year (and up to a maximum of $10,000 in the second year) following the year in which the Executive’s employment terminates, and further provided that the Executive presents such statement(s) no later than 30 days prior to the end of the calendar year following the calendar year in which such expenses were incurred;
(iii) any stock options, stock appreciation rights (SARs), restricted stock, restricted stock units and other similar equity incentive awards held by the Executive that, as of the Termination Date, remain subject to vesting based solely on the Executive’s continued employment with the Company shall immediately become vested, exercisable, and freely transferable, as the case may be, as to all or any part of the shares covered by those awards, with the Executive being able to exercise any stock options or SARs for a period of 12 months following the Termination Date or such longer period as may be permitted under the applicable plan documents and related award agreements. Notwithstanding the foregoing, (i) no option or SAR shall be exercisable after the expiration of its term, and (ii) if it is determined that the extension of the right to exercise an option or SAR for a given period of time would violate Section 409A of the Code, the exercise period for the affected options or SARs will be extended only for the maximum period that would not be deemed an extension of a stock right under Section 409A of the Code and related guidance;
(iv) any stock options, SARs, restricted stock, restricted stock units and other similar equity incentive awards held by the Executive that, as of the Termination Date, remain subject to vesting based all or in part on the satisfaction of one or more performance goals shall immediately become vested, with performance being deemed achieved at the greater of (x) target performance and (y) actual performance (as determined by the Committee); provided, however, that purposes of this clause (iv), actual performance shall be determined as follows: (A) with respect to relative total shareholder return, the per Company share transaction price paid to stockholders in connection with the applicable Change of Control shall be used as the “Ending Stock Price” (as defined in the applicable award agreement) and (B) with respect to organic sales growth, (X) actual performance shall be used for any year during the applicable performance period that is completed prior to the applicable Change of Control and (Y) projected actual performance (as determined by the Committee prior to the applicable Change of Control) shall be used for any other year during the applicable performance period;
(v) if, within the 18-month period immediately preceding the Termination Date, the Executive had relocated the Executive’s primary residence from one location (the “Point of Origin”) to its location at the Termination Date at the request of the Company, then the Company shall reimburse the Executive in cash within 14 days following receipt of substantiating written receipts for any relocation expenses actually incurred in the 12 months immediately following the Termination Date by the Executive in moving the Executive’s primary residence to any location within 35 miles of the Point of Origin, provided that (A) the relocation expense is directly related to the Executive’s Termination of Employment with the Company, (B) any written receipts are presented to the Company within 60 days of the date the
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related relocation expense was incurred by the Executive, and (C) in no event shall the reimbursement made by the Company exceed the lesser of (1) the original cost of relocating the Executive’s primary residence from the Point of Origin to its location on the Termination Date, or (2) the estimated reasonable cost for such relocation expense as determined by the Company’s relocation service provider, whose determination will be final and binding on the Company and the Executive. Upon written request from the Executive, the Company will obtain and provide the Executive with an estimated relocation cost determination from its relocation service provider in advance of any proposed relocation by the Executive;
(vi) The Executive will remain eligible for a prorated annual bonus for the fiscal year that includes the Termination Date based upon the number of days the Executive was employed by the Company during such fiscal year and the actual level of achievement of the applicable performance goals for such fiscal year, provided that any individual-specific performance goals that are based on qualitative performance factors will be deemed satisfied at target level performance. Any prorated annual bonus will be paid to the Executive at the same time annual bonuses are paid to active employees of the Company for the fiscal year that includes the Termination Date, but in no event later than March 15th following the calendar year that includes the Termination Date; and
(vii) If the Company has not granted any annual long-term stock incentive plan award to the Executive for the fiscal year that includes the Termination Date, the Company will make a lump sum payment in cash to the Executive within 30 days following the Termination Date equal to (A) the grant date fair value of any annual long-term stock incentive plan award granted by the Company to the Executive for the immediately preceding fiscal year, determined in accordance with FASB ASC Topic 718, times (B) a fraction, the numerator of which is the number of full months the Executive was employed by the Company during the fiscal year that includes the Termination Date, and the denominator of which is 36.
The payment of any amounts and the provision of any benefits described in this Section 5(d), other than the Accrued Obligations, is conditioned on the Executive’s timely execution and non-revocation of the General Release and Waiver set forth in Section 8.
6. Non-Exclusivity of Rights. Nothing in this Agreement shall prevent or limit the Executive’s continuing or future participation in any benefit, bonus, incentive or other plans, programs, policies or practices provided by the Company and for which the Executive may qualify, nor shall anything herein limit or otherwise affect such rights as the Executive may have under any other agreements with the Company. Amounts that are vested benefits or that the Executive otherwise is entitled to receive under any plan, policy, practice or program of the Company at or subsequent to the Termination Date shall be payable in accordance with such plan, policy, practice or program, except as explicitly modified by this Agreement.
7. Full Settlement; Legal Fees. The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations, except as specifically provided otherwise in this Agreement, shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action the Company may have against the Executive or others. The amounts payable to the Executive will not be subject to any requirement of
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mitigation, nor, except as specifically provided otherwise in this Agreement, will they be offset or otherwise reduced by reason of the Executive’s receipt of compensation from any source other than the Company. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under this Agreement.
8. General Release and Waiver. In exchange for the consideration provided under this Agreement, the Executive agrees to sign a General Release and Waiver of age and other claims on a form substantially in the form attached hereto as Exhibit A. If the period in which the Executive may review and revoke the General Release and Waiver begins in one calendar year and ends in a second calendar year, then any amounts or benefits payable under this Agreement that represent nonqualified deferred compensation subject to Section 409A of the Code will not be paid (or begin to be paid) until the second calendar year, provided that in no event will payment of any amount or provision of any benefit commence later than the end of the payment period specified in this Agreement.
9. Code Section 280G Best Results.
(a) If any payment or benefit Executive would receive pursuant to this Agreement or otherwise, including accelerated vesting of any equity compensation (“Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then such Payment shall be either (x) provided to the Executive in full, or (y) provided to the Executive to such lesser extent which would result in no portion of such Payment being subject to the Excise Tax (the “Cutback Amount”), whichever of the foregoing amounts, when taking into account applicable federal, state, local, and foreign income and employment taxes, such Excise Tax, and other applicable taxes, (all computed at the highest applicable marginal rates), results in the receipt by the Executive, on an after-tax basis, of the greatest amount of the Payment, notwithstanding that all or a portion of such Payment may be subject to the Excise Tax. If a reduction in payments or benefits constituting “parachute payments” is necessary so that the Payment equals the Cutback Amount, reduction shall occur in the following order: (A) payments that are payable in cash that are valued at full value under Treasury Regulation Section 1.280G-1, Q&A 24(a) will be reduced (if necessary, to zero), with amounts that are payable last reduced first; (B) payments due in respect of any equity valued at full value under Treasury Regulation Section 1.280G-1, Q&A 24(a) will be reduced next (if necessary, to zero), with amounts that are payable or deliverable last reduced first; (C) payments that are payable in cash that are valued at less than full value under Treasury Regulation Section 1.280G-1, Q&A 24 will be reduced next (if necessary, to zero), with the highest values reduced first (as such values are determined under Treasury Regulation Section 1.280G-1, Q&A 24); (D) payments due in respect of any equity valued at less than full value under Treasury Regulation Section 1.280G-1, Q&A 24 will be reduced next (if necessary, to zero), with the highest values reduced first (as such values are determined under Treasury Regulation Section 1.280G-1, Q&A 24); and (E) all other non-cash benefits not otherwise described in clause (B) or (D) of this Section 9(a) will be next reduced pro rata. Any reduction in the Payment will be made in a manner consistent with the requirements of Section 409A of the Code.
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(b) Integer shall appoint a nationally recognized accounting firm to make the determinations required hereunder and perform the foregoing calculations. The Company shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder. The accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to Integer and Executive within fifteen (15) calendar days after the Termination Date (if requested at that time by Integer or Executive). Any good faith determinations of the accounting firm made hereunder shall be final, binding and conclusive upon Integer and Executive.
10. Non-Competition. The Executive agrees that in addition to any restrictions contained in any other agreement between the Executive and the Integer Companies and as a pre-requisite to entering into this Agreement, some additional restrictions on Executive’s activities during and after Executive’s employment are necessary to protect the goodwill and other legitimate interests of the Integer Companies:
(a) During the Non-Compete Period, the Executive shall not, directly or indirectly, alone or in conjunction with any other Person (other than the Integer Companies) engage in any Prohibited Activity.
(b) The Executive agrees that, during Executive’s employment with the Integer Companies, Executive will not undertake any outside activity, whether or not competitive with the business of the Integer Companies, that could reasonably give rise to a conflict of interest or otherwise interfere with Executive’s duties and obligations to the Integer Companies, except as otherwise agreed to in writing by the Integer in its sole discretion.
(c) The Executive agrees that, unless another agreement between an Integer Company and the Executive expressly provides, through a direct reference to this Agreement, that any restrictive covenants set forth in that other agreement supersede those in this Agreement, then the restrictive covenants set forth in the other agreement will be in addition to, and not in lieu of, those set forth in this Agreement. Similarly, any restrictive covenants set forth in this Agreement will be in addition to, and not in lieu of, any restrictive covenants set forth in another agreement between an Integer Company and the Executive.
(d) In the event the Executive is employed or otherwise engaged by any other Person following the Termination Date, the Executive agrees to notify, and consents to the notification by the Integer Companies of, such Person of the covenants set forth in this Section 10 and in any other agreement with the Integer Companies.
11. Enforcement of Covenants.
(a) The Executive acknowledges that Executive has carefully read and considered all the terms and conditions of this Agreement, including the restraints imposed upon Executive pursuant to Section 10 hereof. The Executive agrees that said restraints are necessary for the reasonable and proper protection of the Integer Companies and that each and every one of the restraints is reasonable in respect to subject matter, length of time and geographic area. The
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Executive further acknowledges that were Executive to breach any of the covenants contained in Section 10 hereof, the damage to the Integer Companies would be irreparable. The Executive therefore agrees that the Integer Companies, in addition to any other remedies available to them, including monetary damages, shall be entitled to preliminary and permanent injunctive relief, a restraining order or other equitable remedies against any breach or threatened breach by the Executive of any of said covenants, in each case without having to post bond. The Executive agrees not to urge in any such action that an adequate remedy exists at law. The parties further agree that, in the event that any provision of Section 10 hereof shall be determined by any court of competent jurisdiction to be unenforceable by reason of its being extended over too great a time, too large a geographic area or too great a range of activities, such provision shall be deemed to be modified to permit its enforcement to the maximum extent permitted by law. Should the Executive be found to have been in breach of Executive’s noncompetition covenants under this Agreement, the Court shall extend or revise each applicable restraint so as to afford the Integer Companies the full period of restraint contemplated by this Agreement.
(b) The Executive covenants that the Executive will not challenge the reasonableness or enforceability of any of the covenants set forth in Section 10 in a court of competent jurisdiction, provided that it shall not be a violation of the foregoing for the Executive to challenge whether actions or inactions of the Executive constitute a breach of Section 10.
12. Conflicting Agreements. The Executive hereby represents and warrants that the execution of this Agreement and the performance of Executive’s obligations hereunder will not breach or be in conflict with any other agreement to which the Executive is a party or is bound and that the Executive is not now subject to any covenants against competition or similar covenants or any court order or other legal obligation that would affect the performance of Executive’s obligations hereunder. The Executive will not disclose to or use on behalf of the Integer Companies any proprietary information of a third party without such party’s consent.
13. Public Announcements. The Executive shall consult with Integer before issuing any press release or otherwise making any public statement with respect to the Integer Companies, this Agreement or any threatened or pending Change of Control, and the Executive shall not issue any such press release or make any such public statement without prior written approval of Integer, except as may be required by applicable law, rule or regulation or any self-regulatory agency requirements, in which event the Company shall have the right to review and comment upon any such press release or public statement prior to its issuance.
14. Arbitration. Except for any proceeding brought under Section 11(a), any dispute, controversy or claim arising out of or relating to this Agreement, or any breach thereof, shall be determined and settled by arbitration to be held in Collin County, Texas, pursuant to the American Arbitration Association (or any successor organization) rules relating to employment disputes and before a panel of three arbitrators. Any award rendered shall be final, conclusive and binding on the parties. Except as provided by applicable law, the Company and the Executive shall equally pay the arbitrators’ fees, arbitration expenses and any other costs unique to the arbitration proceeding. All other costs, expenses and attorneys’ fees shall be borne by the party incurring them.
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15. Successors.
(a) This Agreement is personal to the Executive and shall not be assignable by the Executive, except that Executive’s right hereunder following death may be assigned by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon Integer and its successors and assigns.
(c) Integer will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of Integer to assume and expressly agree to perform this Agreement in the same manner and to the same extent that Integer would be required to perform if no such succession had taken place. As used in this Agreement, any reference to “Integer” shall mean Integer and any successor to its business or assets which assumes and agrees to perform this Agreement by operation of law, or otherwise.
16. Miscellaneous.
(a) All notices and other communications given pursuant to this Agreement shall be in writing and shall be deemed given only when (a) delivered by hand, (b) transmitted by telex, telecopier or other form of electronic transmission (provided that a copy is sent at approximately the same time by first class mail), or (c) received by the addressee, if sent by registered or certified mail, return receipt requested, or by Express Mail, FedEx or other overnight delivery service, to the appropriate party at the address given below for such party (or to such other address designated by the party in writing and delivered to the other party pursuant to this Section).
If to the Executive:
At the address on file with the Company
If to Integer:
Integer Holdings Corporation
5830 Granite Parkway, Suite 1150
Plano, TX 75024 Attn: Secretary
(b) The Company shall be entitled to deduct or withhold from any amounts payable under this Agreement all amounts that may be required to be deducted or withheld under any applicable law now in effect or that may become effective during the term of this Agreement (including, but not limited to social security contributions and income tax withholdings).
(c) This Agreement shall be governed by and construed in accordance with the laws of the State of Texas, without reference to its principles of conflict of laws. The Executive consents to jurisdiction in Texas and venue in Collin County for purposes of all claims arising
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under this Agreement. THE PARTIES HERETO WAIVE ANY RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY DISPUTES ARISING OUT OF THIS AGREEMENT. The captions of this Agreement are not part of the provisions and shall have no force or effect. Except as specifically referenced in this Agreement, no agreements or representations, oral or otherwise, express or implied, with respect to the subject matter, have been made by either party that are not expressly set forth in this Agreement. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. The Executive’s or Integer’s failure to insist on strict compliance with any provision in any particular instance shall not be deemed to be a waiver· of that provision or any other provision.
(d) Except as otherwise provided by this Section 16(d), no provision of this Agreement may be waived, modified or amended, orally or by any course of conduct, unless such waiver, modification or amendment is set forth in a written agreement duly executed by the parties or their respective successors and legal representatives.
(e) This Agreement contains the entire agreement between the parties regarding the matters described herein, and supersedes any other written or oral understanding or agreement that may have existed in the past regarding the matters described therein, including the Prior Agreement.
17. Section 409A of the Internal Revenue Code.
(a) Notwithstanding anything in this Agreement to the contrary, if an amount hereunder is subject to, and not exempt from, Section 409A of the Code and the Executive is a Specified Employee on the Termination Date, the Executive shall not receive any amount or benefit on account of Executive’s Termination of Employment before the date which is six months after the Termination Date, or, if earlier, upon the Executive’s death. If an amount must be deferred, the first payment shall include an amount equal to the sum of the payments which would have been paid to the Executive but for the payment deferral mandated pursuant to Section 409A(a)(2)(B)(i) of the Code on the first day of the month following the mandated deferral period.
(b) Any reimbursement of expenses or in-kind benefits provided under this Agreement subject to, and not exempt from, Section 409A of the Code shall be subject to the following additional rules: (a) any reimbursement of eligible expenses shall be paid as they are incurred and shall always be paid on or before the last day of the Executive’s taxable year following the taxable year in which the expenses were incurred; provided that the Executive first provides documentation of such expenses in reasonable detail not later than sixty (60) days following the end of the calendar year in which the eligible expenses were incurred; (b) the amount of expenses eligible for reimbursement, or in kind benefits provided, during any calendar year shall not affect the amount of expenses eligible for reimbursement, or in-kind benefits to be provided, during any other calendar year; and (c) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit.
(c) To the extent applicable, it is intended that this Agreement and any amounts or benefits provided hereunder comply with the provisions of Section 409A of the Code, and this Agreement shall be interpreted and administrated in accordance with this intent.
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Notwithstanding any other provision of this Agreement, Integer does not make any representations that any amounts or benefits provided for by this Agreement are exempt from or compliant with Section 409A of the Code, and the Integer Companies shall not be liable to the Executive or any other Person for any adverse tax consequences under Section 409A or any other provision of the Code.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first written above.
INTEGER HOLDINGS CORPORATION:
By: __________________
Name:
Title
EXECUTIVE:
_________________________
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Exhibit A
General Release and Waiver
This General Release and Waiver (the “Release”) is between Integer Holdings Corporation (the “Company”) and _________________ (“you” and similar words), in favor of the Company and its affiliates (meaning any entities that directly or indirectly control, are controlled by, or are under the same control as, the Company or any other entities affiliated with the Company or such entities), in consideration of the benefits provided to you and to be received by you from the Company as described in the Amended and Restated Change of Control Agreement between the Company and you dated as of ____________, 2026 (the “Change of Control Agreement”).
By signing this Release, you and the Company hereby agree as follows:
1. Waiver and Release. You, for yourself and on behalf of anyone claiming through you including each and all of your legal representatives, administrators, executors, heirs, successors and assigns (collectively, the “Releasors”), do hereby fully, finally and forever release, absolve and discharge the Company and each and all of its legal predecessors, successors, assigns, fiduciaries, parents, subsidiaries, divisions and other affiliates, and each of the foregoing’s respective past, present and future principals, partners, shareholders, directors, officers, employees, agents, consultants, attorneys, trustees, administrators, executors and representatives (collectively, the “Company Released Parties”), of, from and for any and all claims, causes of action, lawsuits, controversies, liabilities, losses, damages, costs, expenses and demands of any nature whatsoever, at law or in equity, whether known or unknown, asserted or unasserted, foreseen or unforeseen, that the Releasors (or any of them) now have, have ever had, or may have against the Company Released Parties (or any of them) based upon, arising out of, concerning, relating to or resulting from any act, omission, matter, fact, occurrence, transaction, claim, contention, statement or event occurring or existing at any time in the past up to and including the date on which you sign this Release, including, without limitation: (a) all claims arising out of or in any way relating to your employment with or separation of employment from the Company or its affiliates; (b) all claims for compensation or benefits, including salary, commissions, bonuses, vacation pay, expense reimbursements, severance pay, fringe benefits, equity awards or any other ownership interests in the Company Released Parties; (c) all claims for breach of contract, wrongful termination and breach of the implied covenant of good faith and fair dealing; (d) all tort claims, including claims for fraud, defamation, invasion of privacy and emotional distress; (e) all other common law claims; and (f) all claims (including claims for discrimination, harassment, retaliation, attorneys fees, expenses or otherwise) that were or could have been asserted by you or on your behalf in any federal, state, or local court, commission, or agency, or under any federal, state, local, employment, services or other law, regulation, ordinance, constitutional provision, executive order or other source of law, including without limitation under any of the following laws, as amended from time to time: the Age Discrimination in Employment Act (the “ADEA”), Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 1981 & 1981a, the Americans with Disabilities Act, the Equal Pay Act, the Employee Retirement Income Security Act, the Lilly Ledbetter Fair Pay Act of 2009,
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the Family and Medical Leave Act, Sarbanes-Oxley Act of 2002, the National Labor Relations Act, the Rehabilitation Act of 1973, the Worker Adjustment Retraining and Notification Act, the Uniformed Services Employment and Reemployment Rights Act, Federal Executive Order 11246, the Genetic Information Nondiscrimination Act, any and all claims arising under the Texas Labor Code, including the Texas Payday Act, the Texas Anti-Retaliation Act, Chapter 21 of the Texas Labor Code, and the Texas Whistleblower Act.
2. Scope of Release. Nothing in this Release (a) shall release the Company from any of its obligations set forth in the Change of Control Agreement, awards under the Integer Holdings Corporation 2021 Omnibus Incentive Plan (including as amended or amended and restated to date) or any claim that by law is non-waivable, (b) shall release the Company from any obligation to defend and/or indemnify you against any third party claims arising out of any action or inaction by you during the time of your employment and within the scope of your duties with the Company to the extent (i) you have any such defense or indemnification right (including under your indemnification agreement with the Company or to the extent the claims are covered by the Company’s director & officer liability, employment practices liability, or other applicable insurance), and (ii) permitted by applicable law, (c) shall affect your right to file a claim for workers’ compensation or unemployment insurance benefits, or (d) shall prohibit you from instituting any action to challenge the validity of the release under the ADEA.
You further acknowledge that by signing this Release, you do not waive the right to file a charge against the Company with, communicate with or participate in any investigation by the Equal Employment Opportunity Commission, the Securities and Exchange Commission or any comparable state or local agency. However, you waive and release, to the fullest extent legally permissible, all entitlement to any form of monetary relief arising from a charge you or others may file, including without limitation any costs, expenses or attorneys’ fees. You understand that this waiver and release of monetary relief would not affect an enforcement agency’s ability to investigate a charge or to pursue relief on behalf of others. Notwithstanding the foregoing, you will not give up your right to any benefits to which you are entitled under any retirement plan of the Company that is intended to be qualified under Section 401(a) of the Internal Revenue Code of 1986, as amended, or your rights, if any, under Part 6 of Subtitle B of Title I of the Employee Retirement Income Security Act of 1974, as amended (COBRA), or any monetary award offered by the Securities and Exchange Commission pursuant to Section 21F of the Securities Exchange Act of 1934, as amended, the Dodd-Frank Wall Street Reform and Consumer Protection Act or the Sarbanes-Oxley Act of 2002.
By executing this Release, you represent that, as of the date you sign this Release, no claims, lawsuits, grievances, or charges have been filed by you or on your behalf against the Company Released Parties.
3. Knowing and Voluntary ADEA Waiver. In compliance with the requirements of the Older Workers’ Benefit Protection Act, you acknowledge by your signature below that, with respect to the rights and claims waived and released in this Release under the ADEA,
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you specifically acknowledge and agree as follows: (a) you have read and understand the terms of this Release; (b) you have been advised and hereby are advised, and have had the opportunity, to consult with an attorney before signing this Release; (c) the Release is written in a manner understood by you; (d) you are releasing the Company and the other Company Released Parties from, among other things, any claims that you may have against them pursuant to the ADEA; (e) the releases contained in this Release do not cover rights or claims that may arise after you sign this Release; (f) you will receive valuable consideration in exchange for the Release other than amounts you would otherwise be entitled to receive; (g) you have been given a period of at least 21 days in which to consider and execute this Release (although you may elect not to use the full consideration period at your option); (h) you may revoke this Release during the seven-day period following the date on which you sign this Release, and this Release will not become effective and enforceable until the seven-day revocation period has expired; and (i) any such revocation must be submitted in writing to the Company prior to the expiration of such seven-day revocation period. If you revoke this Release within such seven-day revocation period, it shall be null and void.
4. Entire Agreement. This Release, the Change of Control Agreement, and the documents referenced therein contain the entire agreement between you and the Company regarding the matters described therein, and take priority over any other written or oral understanding or agreement that may have existed in the past regarding the matters described therein. You acknowledge that no other promises or agreements have been offered for this Release (other than those described above) and that no other promises or agreements will be binding unless they are in writing and signed by you and the Company. Should any provision of this Release be declared by a court of competent jurisdiction to be illegal, void, or unenforceable, the remaining provisions shall remain in full force and effect; provided, however, that upon a finding that the Release, in whole or part, is illegal, void, or unenforceable, you shall be required to execute a release that is legal and enforceable.
[SIGNATURE PAGE FOLLOWS]
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I agree to the terms and conditions set forth in this Release.
EXECUTIVE
_________________________________
Date: _____________
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AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT, entered into by and between Integer Holdings Corporation, a Delaware corporation with its principal place of business located at 5830 Granite Parkway, Suite 1150, Plano Texas (the “Company”), and Payman Khales (“Executive”), is dated as of July 27, 2026 (the “Agreement”).
Executive is currently party to an Employment Agreement with the Company, dated as of October 23, 2025, and as amended on May 21, 2026 (the “Prior Agreement”). Effective as of the date hereof (the “Effective Date”), Executive and the Company desire to amend and restate the Prior Agreement on the terms and conditions set forth in this Agreement. On and after the Effective Date, the Company will continue to employ Executive pursuant to the terms and conditions, and for the consideration, set forth in this Agreement, and Executive will continue to be employed by the Company on such terms and conditions and for such consideration.
In consideration of the terms and conditions and mutual promises set forth in this Agreement, plus other valuable consideration, the receipt by the parties to this Agreement and the sufficiency of which are hereby acknowledged by such parties, the Company and Executive hereby agree as follows:
1.Agreement Term. This Agreement shall become effective as of the Effective Date. The Company hereby agrees to continue to employ Executive, and Executive hereby agrees to continue to be employed by the Company, on an at-will basis on the terms and conditions set forth herein for the period commencing on the Effective Date and ending on the October 23, 2028 (or, if earlier, Executive’s Date of Termination, as provided for under Section 3(f) of this Agreement) (such period, the “Initial Term”). On October 23, 2028, and on each anniversary of such date thereafter, the Initial Term shall be extended for an additional year unless either (a) Executive’s employment with the Company shall have previously ended under Section 3 of this Agreement (in which case the Initial Term is extended only until such earlier date), or (b) the Company or Executive shall have given the other party 90 days’ advance written notice that the Initial Term will not be so extended. In this Agreement, the length of such extension past the Initial Term is referred to as the “Extended Term,” and the Initial Term plus any Extended Term is referred to as the “Term”. This Agreement terminates at the conclusion of the Term, except that applicable provisions of this Agreement shall survive such termination of this Agreement as necessary to carry out the then-applicable terms and conditions of this Agreement.
2.Terms of Employment.
(a)Position and Duties. (i) During Executive’s employment by the Company during the Term (the “Employment Period”), Executive shall: (A) serve as CEO of the Company, with such duties and responsibilities as are customarily commensurate with or incident to such positions for an entity similar in size to, and in a business similar to that of, the Company; (B) report to the Board of Directors of the Company (the “Board”); and (C) perform Executive’s services at the Company’s headquarters located in Plano, Texas (subject to reasonable travel
requirements commensurate with Executive’s position). Executive shall continue to serve as a member of the Board.
(i)During the Employment Period, and excluding any periods of paid time off to which Executive is entitled and for other absences or leave permitted or excused under the Company’s policies and procedures or under applicable law, Executive agrees to devote Executive’s full business time and attention to the business and affairs of the Company and its subsidiaries. During the Employment Period, it will not be a violation of this Agreement for Executive to (A) serve on civic, educational, professional, community, or charitable boards, organizations, clubs, or committees, (B) manage personal investments, and (C) serve as a director or trustee of other corporations or organizations, either for profit or not for profit, that are not in competition with the Company, so long as such activities described in clauses (A), (B), and (C) do not significantly interfere with the performance of Executive’s responsibilities as an employee of the Company in accordance with this Agreement.
(b)Compensation. (i) Base Salary. During the Employment Period, Executive shall receive base salary at an annual rate (“Annual Base Salary”) equal to $875,000, paid in accordance with the normal payroll practices of the Company as may be in effect from time to time, which Annual Base Salary shall be reviewed for increase at least annually.
(ii)Annual Short-Term Cash Incentive Bonus. During the Employment Period, Executive shall be eligible, for each fiscal year of the Company or portion of such fiscal year ending during the Employment Period, for an annual short-term incentive award payout in cash (the “Annual STI Bonus”), with a target Annual STI Bonus opportunity equal to 100% of Executive’s Annual Base Salary actually earned for such fiscal year (“Target STI Bonus”). Before or as soon as practicable following the beginning of each applicable full fiscal year or portion of a fiscal year, the Board (or an applicable committee of the Board) has established or will establish, and has communicated or will communicate to Executive in writing, the performance metrics and their relative weighting to be used in (and any specific performance goals applicable to) the determination of the Annual STI Bonus for Executive for such period. There is no guaranteed Annual STI Bonus under this Agreement, and for each applicable fiscal year or portion of a fiscal year, Executive’s Annual STI Bonus could be as low as zero or as high as the maximum percentage applicable under the Company’s annual short-term cash incentive award program for such fiscal year or portion of a fiscal year. Notwithstanding anything in this Agreement to the contrary, each Annual STI Bonus opportunity shall be on the terms and subject to such conditions as are specified for the particular Company plans or programs (if any) pursuant to which the Annual STI Bonus opportunity is granted. Any Annual STI Bonus with respect to a particular fiscal year will be paid in accordance with the terms of the Company’s annual short-term cash incentive award program applicable for such fiscal year.
(iii)Long-Term Incentives. During the Employment Period and subject to approval by the Compensation and Organization Committee of the Board (the “Compensation Committee”), Executive shall continue to be eligible to participate in the Company’s annual long-term incentive compensation programs as may generally be in effect from time to time for all U.S. executives at the level of Executive Vice President and above at the Company, with such participation occurring on terms and conditions in accordance with the approval of the Board or the Compensation Committee, the Company’s policies (if any), the applicable award agreements
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and equity incentive compensation plans under which such awards are granted, as in effect from time to time and communicated to Executive in writing. Executive’s aggregate annual long-term incentive award target for 2026 shall be not less than $5,000,000. The grant of each annual award described in this Section 2(iii) will be subject to the specific approval of the Board or the Compensation Committee.
(iv)Special Equity Grant. Executive acknowledges that a special grant of 7,543 service-based restricted stock units was granted to him on October 24, 2025, which will vest ratably over a three-year period from the date of grant, with the first ratable portion vesting on the first anniversary of the grant date.
(v)Additional Life Insurance Coverage. During the Employment Period, the Company will provide and maintain, at the Company’s sole reasonable expense, to the extent such coverage reasonably can be obtained by the Company, term life insurance with a total face value of not less than $5,000,000 (or such lesser maximum amount of coverage that the Company can reasonably obtain) on the life of Executive. The death beneficiary with respect to such life insurance will be the person or entity designated by Executive in Executive’s sole discretion. This total face value amount includes (and is not in addition to) any insurance that may be provided generally to all U.S. executives at the level of Executive Vice President and above at the Company. Executive will be entitled, at his discretion and expense, to exercise any conversion rights available under such term life insurance, and, to the extent permitted under the applicable life insurance policy, will be entitled to keep and maintain the applicable life insurance policy at Executive’s sole discretion and expense following the end of the Employment Period for any reason.
(vi)Disability Insurance Program Participation. During the Employment Period, Executive will be eligible to participate in the executive class long-term disability insurance program as may generally be in effect from time to time for all U.S. executives at the level of Executive Vice President and above at the Company, to the extent such coverage reasonably can be obtained by the Company.
(vii)Employee Benefits. During the Employment Period, Executive shall be eligible to participate in the employee benefit plans, programs, and policies (including group term life insurance coverage and paid time off programs), as may generally be in effect from time to time for all U.S. executives at the level of Executive Vice President and above at the Company.
(viii)Executive Physical Exam. During the Employment Period, the Company will provide to Executive, at the Company’s sole reasonable expense, an annual comprehensive physical exam, generally as provided for under the Company’s Key Management Physical Examination Program (or any successor or reasonably-comparable Company program).
(ix)Expenses. During the Employment Period, Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by Executive in accordance with the performance of Executive’s duties under this Agreement in accordance with the Company’s business expense reimbursement policy.
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3.Termination of Executive’s Employment and the Term.
(a)Death or Disability. Executive’s employment with the Company and the Term shall terminate automatically if Executive dies during the Employment Period. If the Company determines in good faith that a Disability (as defined herein) has occurred during the Employment Period, the Company may terminate Executive’s employment with the Company and the Term by providing written notice thereof in accordance with Section 14(b) of this Agreement. “Disability” means that Executive, because of accident, disability, or physical or mental illness, is incapable of performing Executive’s duties to the Company or any subsidiary, as determined by the Board. Notwithstanding the foregoing, Executive will be deemed to have become incapable of performing Executive’s duties to the Company or any subsidiary if Executive is incapable of so doing for (i) any continuous period of 90 days and remains so incapable at the end of such 90-day period or (ii) periods amounting in the aggregate to 180 days within any one period of 365 days and remains so incapable at the end of such aggregate period of 180 days.
(b)By the Company. The Company may terminate Executive’s employment with the Company and the Term during the Employment Period for any, or no reason, with or without Cause. For purposes of this Agreement, “Cause” will be deemed to exist upon:
(i)a material breach by Executive of this Agreement;
(ii)gross negligence or willful misconduct in the performance of Executive’s duties to the Company;
(iii)Executive’s continued and willful failure or refusal (other than due to Disability) to perform Executive’s material duties to the Company;
(iv)Executive’s willful or gross misconduct, whether or not in connection with Executive’s duties to the Company, that is likely to materially injure the reputation, business or a business relationship of the Company;
(v)the commission of a felony that results in a conviction or nolo contendre plea in a court of law; or
(vi)a material violation of a material written policy of the Company (including the Company’s Code of Conduct, or any successor policy).
Other than in the case of an act described in clause (v), such cessation of Executive’s employment with the Company and the Term shall not be deemed to be for Cause unless and until there shall have been delivered to Executive a copy of resolutions duly adopted by the affirmative vote of not less than 3/4ths of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice is provided to Executive and Executive is given an opportunity, together with counsel, to be heard before the Board), finding that, in the good faith opinion of the Board, Executive engaged in the conduct described in this Section 3(b), and specifying the particulars in detail.
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(c)By Executive. Executive’s employment with the Company and the Term may be terminated during the Employment Period by Executive for Good Reason or by Executive without Good Reason. For purposes of this Agreement, “Good Reason” shall mean, in the absence of the prior written consent of Executive:
(i)a reduction or diminution in Executive’s Annual Base Salary, Target STI Bonus or annual long-term incentive opportunity;
(ii)a material reduction or diminution in Executive’s authority, duties, or responsibilities regarding the Company, or change in Executive’s reporting structure that results in Executive no longer reporting directly to or being supervised directly by the Board;
(iii)the relocation of Executive’s principal Company office by more than 35 miles (if such relocation results in a material increase in the Executive’s commuting time);
(iv)any other material breach by the Company of this Agreement; or
(v)the failure of the Company to obtain the agreement of any successor of the Company to assume this Agreement in accordance with Section 9(c);
provided, however, that Executive’s termination of such employment and the Term shall not be deemed to be for Good Reason unless (1) Executive has notified the Company in writing describing the occurrence of one or more above-listed Good Reason events within 90 days of such occurrence, (2) the Company fails to cure such Good Reason events within 30 days after its receipt of such written notice and (3) such termination of employment and the Term occurs within 180 days after the occurrence of the applicable Good Reason events.
(d)Resignation. Upon any termination of Executive’s employment with the Company, Executive shall be deemed to resign from any and all positions with the Company (including as an officer, director, or fiduciary of the Company, all of its subsidiaries and all other Company-related entities, or otherwise).
(e)Notice of Termination; Expiration of Employment Period. Any termination of Executive’s employment with the Company by the Company for Cause, or by Executive for Good Reason, shall be communicated by a Notice of Termination to the other party hereto given in accordance with Section 14(b) of this Agreement. “Notice of Termination” means a written notice that (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated, and (iii) if the Date of Termination (as defined herein) is other than the date of receipt of such notice, specifies the Date of Termination (which Date of Termination shall be not more than 30 days after the giving of such notice). The failure by Executive or the Company to set forth in the Notice of Termination any fact or circumstance that contributes to a showing of Good Reason or Cause shall not waive any right of Executive or the Company, respectively, hereunder or preclude Executive or the Company, respectively, from asserting such fact or circumstance in enforcing Executive’s or the Company’s respective rights hereunder.
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(f)Date of Termination. “Date of Termination” means the effective date of Executive’s termination of employment with the Company. Notwithstanding the foregoing, in no event shall the Date of Termination occur until Executive experiences a “separation from service” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the date on which such separation from service takes place shall be the “Date of Termination. Upon the expiration of the Employment Period and in the event Executive continues employment with the Company thereafter, such employment will be at-will and this Agreement will terminate (except that applicable provisions of this Agreement shall survive such termination of this Agreement as necessary to carry out the then-applicable terms and conditions of this Agreement).
4.Obligations of the Company upon Termination. (a) By Executive for Good Reason or by the Company other than for Cause, Death or Disability.
(i)Outside of a Change in Control Period. If, during the Employment Period but not during a Change in Control Period, the Company terminates Executive’s employment with the Company and the Term other than for Cause, death or Disability (or Executive terminates employment with the Company for Good Reason):
(A)The Company shall pay to Executive, in a lump sum in cash within 30 days after the Date of Termination (or earlier, if required by applicable law), the aggregate of the following amounts: (1) Executive’s Annual Base Salary through the Date of Termination to the extent not theretofore paid; (2) Executive’s business expenses that are reimbursable pursuant to Section 2(b)(ix) of this Agreement but have not been reimbursed by the Company as of the Date of Termination; and (3) Executive’s Annual STI Bonus for the fiscal year immediately preceding the fiscal year in which the Date of Termination occurs, if such Annual STI Bonus has been earned but not paid as of the Date of Termination (the sum of the amounts described in subclauses (1), (2), and (3), the “Accrued Obligations”);
(B)Subject to Section 11(b) of this Agreement, within 30 days after the Date of Termination, the Company shall, subject to Section 4(e) of this Agreement, pay to Executive a lump sum cash amount equal to the product obtained by multiplying (1) two, times (2) the sum of (a) Executive’s Annual Base Salary (without regard to any reduction thereto constituting an event of Good Reason), plus (b) Executive’s Target STI Bonus (without regard to any reduction thereto constituting an event of Good Reason);
(C)Subject to Section 11(b) of this Agreement, within 30 days after the Date of Termination, the Company shall, subject to Section 4(e) of this Agreement, pay to Executive a separate lump sum payment equal to the product of (1) 110% of the monthly premium (or the equivalent cost of coverage for self-insured benefits) for medical and prescription drug coverage for the most recently completed month of medical and prescription drug coverage for Executive, Executive’s spouse (if any) and any dependent children who were covered under
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the Company’s medical and prescription drug plans immediately prior to the Date of Termination, times (2) 24;
(D)To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any Other Benefits (as defined in Section 5) in accordance with the terms of the applicable underlying plans, programs, agreements or arrangements; and
(E)For each outstanding performance-based equity award held by Executive on such Date of Termination (“Performance-Based Award”), if the Date of Termination occurs on or following the one-year anniversary of the grant date for such Performance-Based Award, such Performance-Based Award (plus any dividend equivalents relating thereto) will become non-forfeitable as of such Date of Termination on a prorated basis based on the number of days during the applicable performance period prior to (and including) the Date of Termination compared to the total number of days during the applicable performance period, with the level of performance achievement for such Performance-Based Award determined by the Compensation and Organization Committee of the Board of Directors based on actual performance with respect to the applicable performance metrics and goals applicable to such Performance-Based Award. For the avoidance of doubt: (1) any such Performance-Based Award that becomes non-forfeitable in accordance with the immediately prior sentence shall be settled according to the terms of the applicable award agreement and other documentation for such Performance-Based Award in accordance with Section 409A (as subsequently defined in this Agreement); and (2) if such Date of Termination occurs prior to the one-year anniversary of the grant date for any Performance-Based Award, such Performance-Based Award shall be forfeited as of such Date of Termination (or, if different, will be governed by the terms of the applicable award agreement and other documentation for such award). For each outstanding time-based equity award (other than a Performance-Based Award) held by Executive on such Date of Termination (“Time-Based Award”) that is granted on or after the Effective Date, such Time-Based Award (plus any dividend equivalents relating thereto) shall vest as of such Date of Termination on a prorated basis based on the number of days during the applicable time-based vesting period prior to (and including) the Date of Termination compared to the total number of days during the applicable time-based vesting period less the portion, if any, of such Time-Based Award which vested prior to the Date of Termination (unless the applicable award agreement provides for more beneficial treatment, in which case such Time-Based Award will be governed by such award agreement), and shall be settled according to the terms of the applicable award agreement and other documentation for such award in accordance with Section 409A (as subsequently defined in this Agreement). For the avoidance of doubt, (x) any portion of a Time-Based Award which does not vest in accordance with this Section 4(i)(E) will be forfeited and (y) any Time-Based Award that was granted to Executive prior to the Effective Date will be governed by the terms of the applicable award agreement and other documentation for such Time-Based Award.
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(ii)During a Change in Control Period. If, during both the Employment Period and a Change in Control Period, the Company terminates Executive’s employment with the Company and the Term other than for Cause, death or Disability (or Executive terminates employment for Good Reason):
(A)The Company shall pay to Executive, in a lump sum in cash within 30 days after the Date of Termination (or earlier, if required by applicable law), the Accrued Obligations;
(B)Subject to Section 11(b) of this Agreement, within 30 days after the Date of Termination, the Company shall, subject to Section 4(e) of this Agreement, pay to Executive:
(1) a lump sum cash amount equal to the product obtained by multiplying (a) two, times (b) the sum of (i) Executive’s Annual Base Salary (without regard to any reduction thereto), plus (ii) Executive’s Target STI Bonus (without regard to any reduction thereto);
(2) a lump sum payment equal to two times the Company’s total contributions for Executive to any retirement plan (whether qualified or nonqualified) of the Company in effect on the Date of Termination, for the plan year preceding the Date of Termination. This payment will be made in cash and will not eliminate the obligation of the Company to make all scheduled contributions to any retirement plan; provided, that, notwithstanding anything to the contrary herein, if the Date of Termination occurs during the Anticipatory Period, payments under this Section 4(ii)(B)(2) will be made within 10 days after the Change in Control;
(3) a separate lump sum payment equal to the product of (a) 110% of the monthly premium (or the equivalent cost of coverage for self-insured benefits) for medical and prescription drug coverage for the most recently completed month of medical and prescription drug coverage for Executive, Executive’s spouse (if any) and any dependent children who were covered under the Company’s medical and prescription drug plans immediately prior to the Date of Termination, times (b) 24; and
(4) if the Company has not granted any annual long-term incentive awards to Executive for the fiscal year that includes the Date of Termination, a lump sum payment in cash equal to the product obtained by multiplying (a) the aggregate grant date fair value of any annual long-term incentive awards granted by the Company to Executive for the immediately preceding fiscal year, determined in accordance with FASB ASC Topic 718, times (b) a fraction, the numerator of which is the number of full months Executive was employed by the Company during the fiscal year that includes the Date of Termination, and the denominator of which is 36; provided, that, notwithstanding anything to the contrary herein, if
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the Date of Termination occurs during the Anticipatory Period, payments under this Section 4(ii)(B)(4) will be made within 10 days after the Change in Control.
In addition, for each outstanding (a) Time-Based Award held by Executive on such Date of Termination, all portions of such award that are not yet vested shall become vested as of such Date of Termination and (b) Performance-Based Award held by Executive on such Date of Termination, such award shall vest and become non-forfeitable as of such Date of Termination based on the greater of (x) target performance and (y) actual performance (as determined by the Compensation Committee prior to the applicable Change in Control); provided, however, that for purposes of this clause (y), actual performance shall be determined as follows: (A) with respect to relative total shareholder return, the per Company share transaction price paid to stockholders in connection with the applicable Change in Control shall be used as the “Ending Stock Price” (as defined in the applicable award agreement) and (B) with respect to organic sales growth, (X) actual performance shall be used for any year during the applicable performance period that is completed prior to the applicable Change in Control and (Y) projected actual performance (as determined by the Compensation Committee prior to the applicable Change in Control) shall be used for any other year during the applicable performance period, and, in each case, shall be settled according to the terms of the applicable award agreement and other documentation for such award in accordance with Section 409A (as subsequently defined in this Agreement). Notwithstanding the preceding sentence, for purposes of only this paragraph and such vesting, if the Date of Termination occurs during the Anticipatory Period, Executive will be deemed to have continued employment through the Change in Control.
(C)Subject to Section 11(b) of this Agreement, the Company shall, subject to Section 4(e) of this Agreement, pay Executive up to $25,000 for executive outplacement services utilized by Executive; provided, however, that such expenses shall be paid or reimbursed to Executive by the Company on a regular, periodic basis no later than 30 days after presentation by Executive of a statement or statements, up to a maximum of $15,000 in the first year (and up to a maximum of $10,000 in the second year) following the year in which Executive’s employment with the Company terminates; and further provided, that Executive presents such statement(s) no later than 30 days prior to the end of the calendar year following the calendar year in which such expenses were incurred;
(D)Subject to Section 11(b) of this Agreement, if, within the 18-month period immediately preceding the Date of Termination, Executive had relocated Executive’s primary residence from one location (the “Point of Origin”) to its location at the Date of Termination at the request of the Company, then the Company shall, subject to Section 4(e) of this Agreement, reimburse Executive in cash within 14 days following receipt of substantiating written receipts for any
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relocation expenses actually incurred in the 12 months immediately following the Date of Termination by Executive in moving Executive’s primary residence to any location within 35 miles of the Point of Origin; provided, however, that (1) the relocation expense is directly related to Executive’s termination of employment with the Company, (2) any written receipts are presented to the Company within 75 days of the date the related relocation expense was incurred by Executive, and (3) in no event shall the reimbursement made by the Company exceed the lesser of (a) the original cost of relocating Executive’s primary residence from the Point of Origin to its location on the Date of Termination, or (b) the estimated reasonable cost for such relocation expense as determined by the Company’s relocation service provider, whose determination will be final and binding on the Company and Executive. Upon written request from Executive, the Company will obtain and provide Executive with an estimated relocation cost determination from its relocation service provider in advance of any proposed relocation by Executive;
(E)Subject to Sections 4(e) and 11(b) of this Agreement, Executive will remain eligible for a prorated Annual STI Bonus for the fiscal year that includes the Date of Termination based upon Executive’s eligible earnings during such fiscal year from the beginning of such fiscal year until and including the date of termination and the actual level of achievement of the applicable performance goals for such fiscal year; provided, however, that any individual specific performance goals that are based on qualitative performance factors will be deemed satisfied at target level performance. Any such prorated Annual STI Bonus will be paid to Executive, subject to Section 4(e) of this Agreement, in accordance with Section 2(b)(ii), but in no event later than March 15th following the calendar year that includes the Date of Termination; and
(F)To the extent not theretofore paid or provided, the Company shall timely pay or provide to Executive any Other Benefits in accordance with the terms of the applicable underlying plans, programs, agreements or arrangements.
Other than as set forth in this Section 4(a), in the event of a termination of Executive’s employment with the Company and the Term by the Company other than for Cause, death or Disability, or in the event of a termination of Executive’s employment with the Company by Executive for Good Reason, the Company shall have no further obligation to Executive under this Agreement.
(b)Death or Disability. If Executive’s employment with the Company and the Term are terminated by reason of Executive’s death or Disability during the Employment Period, the Company shall provide Executive (or, in the event of Executive’s death, Executive’s estate or beneficiaries) with the Accrued Obligations and the timely payment or delivery of the Other Benefits in accordance with the terms of the applicable underlying plans, programs, agreements or arrangements, and shall have no further obligations under this Agreement. The Accrued Obligations shall be paid to Executive (or, in the event of Executive’s death, Executive’s estate or beneficiaries) in a lump sum in cash within 30 days of the applicable Date of Termination (or earlier, if required by applicable law).
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(c)Termination for Cause. If Executive’s employment with the Company and the Term are terminated for Cause during the Employment Period, the Company shall provide Executive with Executive’s Annual Base Salary through the Date of Termination and Executive’s business expenses that are reimbursable pursuant to Section 2(b)(ix) of this Agreement but have not been reimbursed by the Company as of the Date of Termination and the timely payment or delivery of the Other Benefits in accordance with the terms of the applicable underlying plans, programs, agreements or arrangements, and shall have no further obligations under this Agreement.
(d)Voluntary Termination Other than for Good Reason. If Executive voluntarily terminates employment with the Company other than for Good Reason during the Employment Period, the Company shall provide Executive with the Accrued Obligations and the timely payment or delivery of the Other Benefits in accordance with the terms of the applicable underlying plans, programs, agreements or arrangements, and shall have no further obligations under this Agreement. In such case, all the Accrued Obligations shall be paid to Executive in a lump sum in cash within 30 days of the Date of Termination.
(e)Release. Notwithstanding anything herein to the contrary, the Company shall not be obligated to make any payment under Sections 4(a)(i) or 4(a)(ii) of this Agreement (other than the Accrued Obligations and the Other Benefits) unless (i) no earlier than the Date of Termination and prior to the 55th day following the Date of Termination, Executive executes a release of claims in favor of the Company and its affiliates in a form provided by the Company (the “Release”), provided that such Release form shall not contain any restrictive covenants that Executive has not already entered with the Company as of the Date of Termination (unless otherwise agreed to by Executive), and (ii) any applicable revocation period has expired during such 55-day period without Executive revoking such Release.
(f)Treatment of Equity. Unless otherwise stated in this Agreement, on any termination of Executive’s employment with the Company, the treatment of Executive’s outstanding equity awards will be governed by the terms and conditions of the applicable plan documents and any related award agreements.
(g)Definitions. For purposes of this Section 4:
(i)“Beneficial Owner” has the meaning ascribed to such term in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”);
(ii)“Change in Control” means:
(A)Any Person, other than any employee plan established by the Company or any Company subsidiary, any Company affiliate, an underwriter temporarily holding securities pursuant to an offering of such securities, or an entity owned, directly or indirectly, by stockholders of the Company in substantially the same proportions as their ownership of the Company, is (or becomes, during any 12-month period) the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or its affiliates other than in connection with the acquisition by the
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Company or its affiliates of a business) representing 50% or more of the total voting power of the stock of the Company; provided, however, that the provisions of this subsection (A) are not intended to apply to or include as a Change in Control any transaction that is specifically excepted from the definition of Change in Control under subsection (C) below;
(B)a change in the composition of the Board such that, during any 12-month period, the individuals who, as of the beginning of such period, constitute the Board (the “Existing Board”) cease for any reason to constitute at least 50% of the Board; provided, however, that any individual becoming a member of the Board subsequent to the beginning of such period whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the members of the Board immediately prior to the date of such appointment or election shall be considered as though such individual were a member of the Existing Board; provided, further, that, notwithstanding the foregoing, no individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 or Regulation 14A promulgated under the Exchange Act or successor statutes or rules containing analogous concepts) or other actual or threatened solicitation of proxies or consents by or on behalf of an individual, corporation, partnership, group, associate or other entity or Person other than the Board, shall in any event be considered to be a member of the Existing Board;
(C)the consummation of a merger, amalgamation or consolidation of the Company with any other corporation or other entity, or the issuance of voting securities in connection with such a transaction pursuant to applicable stock exchange requirements; provided, however, that immediately following such transaction the voting securities of the Company outstanding immediately prior thereto do not continue to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity of such transaction or parent entity thereof) 50% or more of the total voting power and total fair market value of the Company’s stock (or, if the Company is not the surviving entity of such merger or consolidation, 50% or more of the total voting power and total fair market value of the stock of such surviving entity or parent entity thereof); and provided, further, that such a transaction effected to implement a recapitalization of the Company (or similar transaction) in which no Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or its affiliates other than in connection with the acquisition by the Company or its affiliates of a business) representing 50% or more of either the then-outstanding common stock of the Company or the combined voting power and total fair market value of the Company’s then-outstanding voting securities shall not be considered a Change in Control; or
(D)the sale or disposition by the Company of all or substantially all of the Company’s assets in which any Person acquires (or has acquired during the
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12-month period ending on the date of the most recent acquisition by such Person) assets from the Company that have a total gross fair market value equal to more than 50% of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions.
(iii)Notwithstanding the foregoing, (1) no Change in Control shall be deemed to have occurred if there is consummated any transaction or series of integrated transactions immediately following which the record holders of the shares of common stock of the Company immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in an entity which owns substantially all of the assets of the Company immediately prior to such transaction or series of transactions and (2) no Change in Control shall be deemed to have occurred upon the acquisition of additional control of the Company by any Person that is considered to effectively control the Company. In no event will a Change in Control be deemed to have occurred if the Executive is part of a “group” within the meaning of Section 13(d)(3) of the Exchange Act that effects a Change in Control. Notwithstanding any other provision of this Agreement, to the extent necessary to comply with Section 409A of the Code, a “Change in Control” will be considered to have occurred only if the event constitutes a change in control event under Section 409A of the Code;
(iv)“Change in Control Period” means the period starting 60 days prior to the consummation of a Change in Control and ending 24 months following such consummation of such Change in Control (the 60-day period prior to such consummation of such Change in Control, the “Anticipatory Period”); and
(v)“Person” has the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act, and used in Sections 13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) thereof.
5.Non-Exclusivity of Rights. Amounts that Executive is otherwise entitled to receive under applicable law or any plan, policy, practice or program of, or any other contract or agreement with, the Company at or subsequent to the Date of Termination (“Other Benefits”) shall be payable in accordance with such plan, policy, practice, program, contract or agreement, except as explicitly modified by this Agreement. Notwithstanding the foregoing, Executive shall not be eligible to participate in any other severance plan, program or policy of the Company during the Term. Notwithstanding anything in this Agreement to the contrary, there shall be no payment or provision of duplicative compensation and/or benefits under the terms of this Agreement, Executive’s outstanding equity awards and the Other Benefits, as applicable.
6.Set-off; No Mitigation. The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall be subject to set-off, counterclaim, recoupment, defense, or other claim, right or action that the Company may have against Executive to the extent such set-off or other action does not violate Section 409A of the Code. In no event shall Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to Executive under any of the provisions of this Agreement.
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7.Limitations on Payments Under Certain Circumstances. Notwithstanding any provision of any other plan, program, arrangement or agreement to the contrary, in the event that it shall be determined that any payment or benefit to be provided by the Company to Executive pursuant to the terms of this Agreement or any other payments or benefits received or to be received by Executive (a “Payment”) in connection with or as a result of any event which is deemed by the U.S. Internal Revenue Service or any other taxing authority to constitute a change in the ownership or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company and subject to the tax (the “Excise Tax”) imposed by Section 4999 (or any successor section) of the Code, the Payments, whether under this Agreement or otherwise, shall be reduced so that the Payment, in the aggregate, is reduced to the greatest amount that could be paid to Executive without giving rise to any Excise Tax; provided, however, that in the event that Executive would be placed in a better after-tax position after receiving all Payments and not having any reduction of Payments as provided hereunder, Executive shall, notwithstanding the provisions of any other plan, program, arrangement or agreement to the contrary, receive all Payments and pay any applicable Excise Tax. All determinations under this Section 7 shall be made by a nationally recognized accounting firm selected by the Company (the “Accounting Firm”). Without limiting the generality of the foregoing, any determination by the Accounting Firm under this Section 7 shall take into account the value of any reasonable compensation for services to be rendered by Executive (or for holding oneself out as available to perform services and refraining from performing services (such as under a covenant not to compete)). If the Payments are to be reduced pursuant to this Section 7, the Payments shall be reduced in the following order: (a) first, by reducing any cash payments with the last scheduled payment reduced first; (b) second, by reducing any equity-based benefits that are included at full value under Q&A-24(a) of the Treasury Regulations promulgated under Section 280G of the Internal Revenue Code (the “280G Regulations”), with the highest value reduced first; (c) third, by reducing any equity-based benefits included on an acceleration value under Q&A-24(b) or 24(c) of the 280G Regulations, with the highest value reduced first; and (d) fourth, by reducing any non-cash, non-equity based benefits, with the latest scheduled benefit reduced first.
8.Restrictive Covenants. (a) Agreement Regarding Restrictive Covenants. By signing this Agreement, Executive reaffirms that, subject to applicable law, Executive will continue to abide by the restrictive covenants to which Executive is subject as of the Effective Date (and any new restrictive covenants to which Executive subsequently consents), including as set forth in or applicable under the Company’s policies and any applicable equity award agreements and equity incentive compensation plans as in effect from time to time, which restrictive covenants will expressly survive the end of the Term in accordance with and pursuant to their terms. Further, Executive acknowledges that during the term of Executive’s employment with the Company, Executive has received access to the Company’s confidential information and trade secrets, as well as specialized training, and will continue to have access to such information and training during Executive’s service to the Company as CEO.
(b) Defend Trade Secrets Act Impact. The U.S. Defend Trade Secrets Act of 2016 (“DTSA”) provides that an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (1) is made in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or
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(2) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. In addition, the DTSA provides that an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal and does not disclose the trade secret, except pursuant to court order.
9.Successors.
(a)This Agreement is personal to Executive and without the prior written consent of the Company shall not be assignable by Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of, and be enforceable by, Executive’s legal representatives.
(b)This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns, including as part of any Change in Control. As used in this Section 9, “Company” shall mean the Company defined in the preamble of this Agreement and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.
(c)The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Company to assume and expressly agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. As used in this Agreement, any reference to the “Company” shall mean the Company and any successor to its business or assets which assumes and agrees to perform this Agreement by operation of law, or otherwise.
10.Indemnification. The Company shall indemnify Executive to the maximum extent permitted under applicable law for acts taken within the scope of Executive’s employment and Executive’s service as an officer or director of the Company or any of its subsidiaries or affiliates. To the extent that the Company obtains coverage under a director and officer or an employment practices liability indemnification or insurance policy, Executive will be entitled to such coverage on a basis that is no less favorable than the coverage provided to any other officer or director of the Company, and such coverage shall extend to Executive during and after the Term for any acts taken within the scope of Executive’s employment and Executive’s service as an officer or director of the Company or any of its subsidiaries or affiliates.
11.Section 409A of the Code.
(a)The intent of the parties hereto is that payments and benefits under this Agreement comply with, or be exempt from, Section 409A of the Code and the regulations and guidance promulgated thereunder (collectively “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith.
(b)Notwithstanding any provision of this Agreement to the contrary, in the event that Executive is a “specified employee” within the meaning of Section 409A (as
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determined in accordance with the methodology established by the Company as in effect on the Date of Termination) (a “Specified Employee”), any payments or benefits that are considered non-qualified deferred compensation under Section 409A payable under this Agreement on account of a “separation from service” during the six-month period immediately following the Date of Termination shall, to the extent necessary to comply with Section 409A, instead be paid, or provided, as the case may be, as soon as administratively practicable on or after the first business day after the date that is six months following Executive's “separation from service” within the meaning of Section 409A, but in any case no later than the first regularly scheduled payroll following such anniversary. For purposes of Section 409A, Executive’s right to receive any installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments. In no event may Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement that is considered nonqualified deferred compensation, subject to Section 409A.
(c)With regard to any provision herein that provides for reimbursement of costs and expenses or in-kind benefits that are deferred compensation subject to Section 409A, (i) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year and (iii) such payments shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense occurred.
12.Compensation Recovery Policy. Notwithstanding anything in this Agreement to the contrary, Executive acknowledges and agrees that this Agreement and any compensation described herein are subject to the terms and conditions of the Company's clawback policy or policies as may be in effect from time to time, including specifically to implement Section 10D of the Exchange Act and any applicable rules or regulations promulgated thereunder (including applicable rules and regulations of any national securities exchange on which the shares of the Company’s common stock may be traded) (the “Compensation Recovery Policy”), and that, to the extent the Compensation Recovery Policy, and any other clawback policy in effect from time to time, by its or their terms, is or are applicable to this Agreement or compensation described herein, applicable terms or sections of this Agreement and any related documents shall be (if necessary) deemed modified and/or superseded by and subject to the terms and conditions of such policies from and after the effective date thereof. Further, Executive agrees to fully cooperate with the Company in connection with any of Executive’s obligations to the Company pursuant to the Compensation Recovery Policy, and any other clawback policy, and agrees that the Company may enforce its rights under such policies through any and all reasonable means permitted under applicable law as it deems necessary or desirable, in each case from and after the effective dates thereof.
13.Complete Agreement. This Agreement and any restrictive covenant agreements or arrangements between Executive and the Company or its affiliates (as otherwise referred to herein) set forth the entire agreement of the parties hereto in respect of the subject matter contained herein, and supersede all prior agreements, promises, covenants, arrangements, communications, representations or warranties, whether oral or written, by any officer, employee or representative of any party hereto in respect of the subject matter contained herein, including
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(a) that certain Offer Letter by and between the Company and Executive dated as of February 6, 2018 (the “Offer Letter”), (b) that certain Change of Control Agreement by and between the Company and Executive and (c) the Prior Agreement, and Executive acknowledges and agrees that as of the Effective Date the Offer Letter and Prior Agreement are amended and restated by this Agreement and of no further force or effect.
14.Miscellaneous.
(a)This Agreement shall be governed by and construed in accordance with the laws of the State of Texas, without reference to principles of conflict of laws. Executive agrees that the state and federal courts located in the State of Texas shall have jurisdiction in any action, suit or proceeding against Executive based on or arising out of this Agreement and Executive hereby: (i) submits to the personal jurisdiction of such courts; (ii) consents to service of process in connection with any action, suit or proceeding against Executive; and (iii) waives any other requirement (whether imposed by statute, rule of court or otherwise) with respect to personal jurisdiction, venue or service of process. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives.
(b)All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, or nationally-recognized overnight courier service, postage prepaid, addressed as follows:
If to Executive: At the most recent address
on file at the Company; and
on file at the Company; and
If to the Company: Integer Holdings Corporation
5830 Granite Parkway, Suite 1150
Plano, TX 75024
Attention: Corporate Secretary;
or to such other address as either party shall have furnished to the other in writing in accordance herewith (including via electronic mail). Any notice under this Agreement will be deemed to have been given when so delivered (or, in the case of electronic mail, when electronic evidence of transmission is received).
(c) The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.
(d) The Company, its subsidiaries and affiliates may withhold from any amounts payable under this Agreement such Federal, state, local or foreign taxes or social security or other charges as shall be required to be withheld pursuant to any applicable law or regulation. None of the Company, its subsidiaries or affiliates guarantees any tax result with respect to payments or benefits provided hereunder. Executive is responsible for all taxes owed with respect to all such payments and benefits.
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(e) Subject to any limits on applicability contained therein, Section 8 and Section 12 of this Agreement shall survive and continue in full force in accordance with its terms notwithstanding any termination or expiration of the Term.
(f) This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.
(g) Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right Executive or the Company may have hereunder shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
(h) With respect to any controversy or claim arising out of or relating to or concerning injunctive relief for Executive’s breach or purported breach of Section 8 of this Agreement, the Company shall have the right, in addition to any other remedies it may have, to seek specific performance and injunctive relief with a court of competent jurisdiction, without the need to post a bond or other security.
(i)Executive acknowledges that Executive has had an opportunity to consult an attorney before signing this Agreement. Executive further acknowledges that in signing this Agreement, Executive has relied only on the promises written in this Agreement and not on any other promise made by the Company or any related company. Executive shall be reimbursed by the Company for reasonable attorney’s fees and expenses incurred in the preparation and negotiation of the terms of this Agreement in an amount not to exceed $20,000.
15.Other Acknowledgements. Nothing in this Agreement (or otherwise) (a) limits Executive’s right to any monetary award offered by a government-administered whistleblower award program for providing information directly to a government agency (including the Securities and Exchange Commission pursuant to Section 21F of the Exchange Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, or the Sarbanes-Oxley Act of 2002) or (b) prevents Executive from providing, without prior notice to the Company, information (including documents) to governmental authorities or agencies regarding possible legal violations or otherwise testifying or participating in any investigation or proceeding by any governmental authorities or agencies regarding possible legal violations (for purpose of clarification, Executive is not prohibited from providing information (including documents) voluntarily to the Securities and Exchange Commission pursuant to Section 21F of the Exchange Act). The Company nonetheless asserts and does not waive its attorney-client privilege over any information appropriately protected by privilege.
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IN WITNESS WHEREOF, Executive and the Company have executed this Agreement on the date first above written.
EXECUTIVE
/s/ Payman Khales
Payman Khales
Payman Khales
INTEGER HOLDINGS CORPORATION
By /s/ Kirk Thor
Name: Kirk Thor
Title: Chief Human Resources Officer
Name: Kirk Thor
Title: Chief Human Resources Officer
#103057843v4
June 26, 2026
Jim Stephens
Dear Jim,
As we have discussed, you will transition to the role of Executive Vice President, Special Projects, with a focus on activities related to the Company’s new operating model and ensuring a seamless transition. In this position, you will continue reporting directly to Payman Khales, President and Chief Executive Officer, and will continue to be a member of the Company’s Executive Leadership Team.
The general terms of your employment offer are described below. The terms of this offer are subject to the approval by Integer’s Compensation and Organization Committee of the Board of Directors.
•You will begin your new role, effective June 29, 2026. The role will end on March 31, 2027 (or such earlier date as your employment is terminated by you or Integer).
•If (i) a Change of Control (as such term is defined in the Amended and Restated Change of Control Agreement, dated as of May 22, 2026, between you and the Company (the “CIC Agreement”)) occurs on or prior to March 31, 2027 and (ii) you remain employed through March 31, 2027, your separation on March 31, 2027 will be considered a termination without Cause (as such term is defined in the CIC Agreement) for purposes of the CIC Agreement. For the avoidance of doubt, if a Change of Control occurs and your employment is subsequently terminated by Integer without Cause or by you for Good Reason (as such term is defined in the CIC Agreement) prior to March 31, 2027, you will still be eligible for severance in accordance with the terms of the CIC Agreement.
•Your 2026 short-term incentive (“STI”) award will remain unchanged. You will not be eligible for an STI or long-term incentive award for 2027.
•All other terms and conditions of your employment will remain the same.
If you agree with the above conditions, please indicate your acceptance by signing this letter and returning it to me.
Please do not hesitate to contact me if you have any questions.
Sincerely,
/s/ Payman Khales
Payman Khales
President and Chief Executive Officer
Understood, agreed, and acknowledged
/s/ Jim Stephens 06/26/2026
__________________________________ ________________
Jim Stephens Date
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June 26, 2026
Andrew Senn
Dear Andrew,
As we’ve discussed, we are very pleased to offer you the position of President, Growth and Innovation, working from our Plymouth location. The duties of this role include company-wide responsibility for R&D, Commercial, Marketing, and Corporate Development. In this position, you will be reporting directly to Payman Khales, President and Chief Executive Officer. In this role, you will be a member of the Company’s Executive Leadership Team. Your targeted start date in this new role will be June 29, 2026. The general terms of your employment offer are described below. The terms of this offer are subject to the approval by Integer’s Compensation and Organization Committee of the Board of Directors.
You agree to the best of your ability and experience that you will, at all times, loyally and conscientiously perform all of the duties and obligations required of the position, which shall be consistent with those customarily performed by the President, Growth and Innovation and will abide fully with the Company’s Code of Ethics.
During the term of your employment, you further agree that you will devote all of your business time and attention to the business of the Company and that you will not, directly, or indirectly, engage or participate in any personal, business, charitable or other enterprise that is competitive in any manner with the business of the Company, whether or not such activity is for compensation, without the Company’s prior written consent.
Compensation, Hours of Work, and Benefits
Associates of Integer are provided with opportunities to be recognized and rewarded based on individual and Company performance. The Company also provides a variety of benefits to its Associates. The Company reserves the right in its sole discretion to modify prospectively the compensation and benefits provided.
BASE COMPENSATION: Your starting compensation will be $20,000 payable bi-weekly on Fridays, which is equivalent to $520,000 USD annually, less appropriate deductions for taxes and other amounts as agreed or as required by law to be withheld.
As an exempt salaried associate, there are no set hours for your position. However, you are generally expected to observe our regular business hours which are 8:00 a.m. to 5:00 p.m., Monday through Friday. Associates in exempt positions are expected to work the hours necessary to complete assignments on a schedule that satisfies the requirements and responsibilities of the job. Associates in exempt positions are not entitled to compensation for hours in excess of 40 in a workweek.
SHORT TERM INCENTIVE (STI) PLAN: Your position continues to be eligible to participate in the Company’s Short-Term Incentive (“STI”) program and will be prorated based upon your eligible earnings. Your 2026 STI target is 70% of your total eligible earnings for the plan year. Integer STI Plan awards are subject to approval by the Board of Directors and are reviewed annually.
ANNUAL LONG-TERM INCENTIVE (LTI) PLAN: Your position continues to be eligible to participate in the Company’s annual Long-Term Incentive (“LTI”) program. The next annual LTI awards are expected to be granted in January 2027, subject to approval by the Company’s Compensation and Organization Committee.
PAID TIME OFF: You will be eligible to receive Paid Time Off (PTO) in accordance with the company’s PTO policy.
PAID TIME OFF: You will be eligible to receive Paid Time Off (PTO) in accordance with the company’s PTO policy.
BENEFITS: Subject to the terms and conditions of eligibility, you will be eligible to participate in the Integer benefit and wellness plans. Such benefits currently include medical, dental and vision coverage, a 401(k) plan, life and disability insurance coverage, Section 125 Flexible Spending Plan and other exciting wellness programs.
EXECUTIVE STOCK OWNERSHIP GUIDELINES: Integer Holdings Corporation maintains executive stock ownership guidelines, designed to align the interests of its executives with shareholders.
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Additionally, you will be eligible for the following Executive Benefits.
EXECUTIVE LIFE INSURANCE: At the Company’s expense and subject to you meeting the underwriters’ insurability standards, term life insurance with a total face value of $1,000,000, with the death beneficiary designated by you.
EXECUTIVE LONG-TERM DISABILITY: Participation in the Executive long-term disability program currently providing a benefit equal to 60% of base salary and short-term incentive (short-term incentive is calculated using the average of payments from the last two years).
EXECUTIVE PHYSICAL EXAMINATION: Consistent with our interest in you maintaining your personal health, eligibility for the key management Physical Examination Program.
401(k) RESTORATION PLAN: This benefit allows you to defer compensation and receive the Company matching contribution on earnings above the IRS limits for qualified 401(k) plans.
DIRECTOR AND OFFICER LIABILTY AND FIDUCIARY INSURANCE: You will be covered by the Company’s Director and Officer Liability Insurance policies. In addition, you will be covered by the Company’s fiduciary liability insurance for any service related to employee benefit plans.
All plans, policies and programs described in this section are subject to change at any time at the sole discretion of the Company.
Reimbursement of Expenses
You will be reimbursed for reasonable expenses that you may incur on behalf of and at the request of the Company in the performance of your responsibilities and duties, with the expectation that you will exercise reasonable and prudent expense control practices that are subject to audit by a designated representative of the Compensation and Organization Committee. Given that you may be required to attend evening events and/or dinners, the Company will reimburse you for related business travel, hotel and meal expenses.
Change of Control
If your employment is terminated following a Change of Control, as defined under the Change of Control Agreement between you and the Company, dated May 22, 2026, the Company will provide you with the payments and benefits to which you are entitled under the terms of the Change of Control Agreement.
Termination of Employment
If at any time during your employment the Company terminates your employment for any reason other than Cause or Disability, you will, subject to the terms and conditions described in this paragraph, receive a severance benefit, payable in a single lump sum cash payment, that is equal to the sum of one year of your current base salary at the time of your termination of employment and the amount the Company reasonably anticipates it would otherwise have contributed to the Company’s medical plan on your behalf for the 12 months following the date of termination, less applicable tax withholdings. As a condition of receipt of the severance benefit, you will be required to execute a Separation Agreement and Release satisfactory to the Company in its reasonable discretion within 45 days after the date of termination of your employment and not thereafter revoke the Separation Agreement and Release as permitted therein. If you timely provide an effective Separation Agreement and Release to the Company, the severance benefit will be paid on the 60th day following your termination of employment. Notwithstanding the foregoing, no severance benefit will be paid under this paragraph if a severance benefit is payable under the Change of Control Agreement.
If your employment is terminated for Cause or Disability (as hereinafter defined), you will not be eligible for the severance benefit. “Cause” means a material breach of this letter, gross negligence, or willful misconduct in the performance of your duties, dishonesty to the Company, the commission of a felony that results in a conviction of law, or a material violation of the written policies of the Company. “Disability” means a disability that would qualify as such under the Company’s long-term disability plan.
Code Section 409A Compliance
Page 2 of 3
It is intended that all terms and payments under this letter comply with and be administered in accordance with Section 409A of the Internal Revenue Code (the “Code”) so as not to subject you to payment of interest or any additional tax under Code Section 409A. All terms of this letter that are undefined or ambiguous will be interpreted in a manner that is consistent with Code Section 409A if necessary, to comply with Code Section 409A. If payment or provision of any amount or benefit under this letter at the time specified would subject such amount or benefit to any additional tax under Code Section 409A, the payment or provision of such amount or benefit will be postponed, if possible, to the earliest commencement date on which the payment or provision of such amount or benefit could be made without incurring such additional tax. The Company will, to the extent reasonably possible, amend this letter in order to comply with Code Section 409A and avoid the imposition of any interest or additional tax under Code Section 409A; provided, however, that no amendment is required if such amendment would change the amount payable by the Company under this letter.
Notwithstanding any other provision of the letter, if it is determined that you are a Specified Employee and that any amount or benefit payable under this letter (a) is subject to Code Section 409A and (b) is payable solely because you have incurred a separation from service, then the amount or benefit will not be paid (or begin to be paid) prior to the date that is six months after the date of your separation from service (or, if earlier, your date of death). Payment of any amount or benefit to which you would otherwise be entitled during the first six months following the date of your separation from service will be accumulated and paid on the day that is six months after the date of your separation from service. For purposes of this letter, a “Specified Employee” is an individual who is determined to be a “specified employee” within the meaning of Code Section 409A.
Any reimbursement of expenses or in-kind benefits provided under this letter subject to, and not exempt from, Code Section 409A will be subject to the following additional rules: (i) any reimbursement of eligible expenses will be paid on or before the last day of the calendar year following the calendar year in which the expenses were incurred; (ii) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during any calendar year will not affect the amount of expenses eligible for reimbursement, or in-kind benefits to be provided, during any other calendar year; and (iii) the right to reimbursement or in-kind benefits will not be subject to liquidation or exchange for another benefit.
At-Will Employment
Your employment with the Company will be “at will,” meaning that either you or the Company can terminate your employment at any time, with or without cause, reason, or notice.
To accept, please sign and return this form to me.
Please do not hesitate to contact us if you have any questions.
Sincerely,
/s/ Payman Khales
Payman Khales
President and Chief Executive Officer
Understood, agreed, and acknowledged
/s/ Andrew Senn 6/26/26
Andrew Senn Date
Page 3 of 3
Integer Holdings Corporation
May [●], 2026
[Full Name]
RE: Retention Bonus
Dear [First Name]:
As you are aware, on April 30, 2026, Integer Holdings Corporation announced a strategic review to maximize stockholder value (the “Strategic Review”). In connection with the Strategic Review, and in light of your critical importance to us, we are pleased to provide you with a one-time special retention bonus (the “Retention Bonus”) in accordance with this letter agreement.
The aggregate amount of the Retention Bonus is $[●]. 50% of the Retention Bonus will vest and be paid to you on December 31, 2026 (or, if earlier, upon the closing of a Change in Control (as defined in our 2026 Omnibus Incentive Plan)), and 50% of the Retention Bonus will vest and be paid to you upon the closing of a Change in Control, in each case, as long as you continue to be employed by us through the applicable vesting date. If your employment terminates for any reason, any unvested portion of the Retention Bonus will be forfeited for no consideration.
The Retention Bonus will be subject to all applicable tax withholding and deductions. This letter agreement will be binding on any successor.
We thank you for your commitment to Integer and look forward to your continued contribution to our overall success.
Sincerely,
Payman Khales President & Chief Executive Officer | ||
Acknowledged and agreed:
| [EXECUTIVE NAME] | ||
Integer Holdings Corporation
May [●], 2026
Payman Khales
RE: Retention Bonus
Dear Payman:
As you are aware, on April 30, 2026, Integer Holdings Corporation announced a strategic review to maximize stockholder value (the “Strategic Review”). In connection with the Strategic Review, and in light of your critical importance to us, we are pleased to provide you with a one-time special retention bonus (the “Retention Bonus”) in accordance with this letter agreement.
The aggregate amount of the Retention Bonus is $[●]. 50% of the Retention Bonus will vest and be paid to you on December 31, 2026 (or, if earlier, upon the closing of a Change in Control (as defined in our 2026 Omnibus Incentive Plan)), and 50% of the Retention Bonus will vest and be paid to you upon the closing of a Change in Control, in each case, as long as you continue to be employed by us through the applicable vesting date. If your employment terminates for any reason, any unvested portion of the Retention Bonus will be forfeited for no consideration.
The Retention Bonus will be subject to all applicable tax withholding and deductions. This letter agreement will be binding on any successor.
We thank you for your commitment to Integer and look forward to your continued contribution to our overall success.
Sincerely,
Kirk Thor Executive Vice President, Chief Human Resources Officer | ||
Acknowledged and agreed:
| Payman Khales | ||
Exhibit 31.1
CERTIFICATION
I, Payman Khales, certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q for the fiscal quarter ended July 3, 2026 of Integer Holdings Corporation; | ||||
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by the report; | ||||
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | ||||
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | ||||
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |||||||
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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; | |||||||
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and | |||||||
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. | |||||||
| 5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditor and the audit committee of registrant’s board of directors (or persons performing the equivalent functions): | ||||
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |||||||
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. | |||||||
| Dated: | August 4, 2026 | /s/ Payman Khales | |||||||||
| Payman Khales | |||||||||||
| President and Chief Executive Officer | |||||||||||
| (Principal Executive Officer) | |||||||||||
Exhibit 31.2
CERTIFICATION
I, Diron Smith, certify that:
| 1. | I have reviewed this quarterly report on Form 10-Q for the fiscal quarter ended July 3, 2026 of Integer Holdings Corporation; | ||||
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by the report; | ||||
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | ||||
| 4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | ||||
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |||||||
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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; | |||||||
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and | |||||||
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. | |||||||
| 5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditor and the audit committee of registrant’s board of directors (or persons performing the equivalent functions): | ||||
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |||||||
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. | |||||||
| Dated: | August 4, 2026 | /s/ Diron Smith | |||||||||
| Diron Smith | |||||||||||
| Executive Vice President and Chief Financial Officer | |||||||||||
| (Principal Financial Officer) | |||||||||||
Exhibit 32.1
CERTIFICATION
Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002
Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the undersigned officers of Integer Holdings Corporation (the “Company”), does hereby certify, to such officer’s knowledge, that:
The Quarterly Report on Form 10-Q for the quarter ended July 3, 2026 (the “Form 10-Q”) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.
| Dated: | August 4, 2026 | /s/ Payman Khales | |||||||||
| Payman Khales | |||||||||||
| President and Chief Executive Officer | |||||||||||
| (Principal Executive Officer) | |||||||||||
| Dated: | August 4, 2026 | /s/ Diron Smith | |||||||||
| Diron Smith | |||||||||||
| Executive Vice President and Chief Financial Officer | |||||||||||
| (Principal Financial Officer) | |||||||||||
This certification is being furnished solely to accompany this Form 10-Q pursuant to 18 U.S.C. Section 1350, and is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, and is not to be deemed incorporated by reference into any filing of the Company except to the extent the Company specifically incorporates it by reference therein.