24. RESTRUCTURING CHARGES

In June 2022, the Board of Directors approved a strategic integration and cost optimization initiative (the “2022 Initiative”) that includes a global workforce reduction, facilities consolidation, and other operational savings measures. As part of the facilities consolidation, the Company approved plans to sell two facilities and relocate operations from those locations to existing facilities. The purpose of the 2022 Initiative is to streamline the Company’s operational structure, reducing its operating expenses and managing its cash flows.

In January 2023, the Company committed to additional actions to continue and expand the 2022 Initiative. These additional actions included closing and consolidating select locations in the United States and Canada and reducing the Company’s workforce by

an additional 15%, prioritizing investments and operations in line with near-term revenue generation, positioning us to achieve our long-term financial goals. The 2022 Initiative was complete as of December 31, 2023. In connection with the 2022 Initiative, the Company incurred total restructuring charges of $20.9 million, including one-time termination benefits and associated costs, inventory write-offs, lease termination and equipment exit costs, and contract termination costs.

On January 22, 2024, the Company committed to a strategic integration and cost optimization initiative (the “2024 Initiative”) that includes a global workforce reduction of approximately 20%, facilities consolidation, product rationalization and other operational savings measures. The Company has commenced workforce reductions in the United States and is reviewing workforce changes in other countries, the timing of which will vary according to local regulatory requirements. In connection with the 2024 Initiative, the Company sold a facility in St. Clairesville, Ohio as well as related equipment in the facility. During the year ended December 31, 2023, the Company incurred restructuring charges related to the 2024 Initiative of $30.9 million, primarily including $26.5 million of inventory write-offs. As a result of the 2024 Initiative, the Company anticipates at least $50 million of aggregate annualized cost savings resulting in sequential cost reductions across the first half of 2024. The Company anticipates that the 2024 Initiative will be substantially complete by the end of 2024.

During the three and six months ended June 30, 2024, the Company recorded restructuring charges of $0.4 million and $2.1 million, respectively, related to employee severance, benefits and related costs, inventory write-offs, royalty expenses associated with discontinued product offerings, and facility consolidations in connection with the 2024 Initiative and the 2022 Initiatives. During the three and six months ended June 30, 2023, the Company recorded restructuring charges of $2.9 million and $6.5 million, respectively, related to employee severance, benefits and related costs, inventory write-offs, royalty expenses associated with discontinued product offerings, and facility consolidations in connection with the 2022 Initiative.

On March 14, 2024, following a comprehensive review of the Company’s operating plan, the Board of Directors approved an additional cost reduction plan that includes a review of strategic alternatives for the Company’s photopolymer business and a review of other potential cost saving actions (the “Photopolymer Initiative”). The Company explored alternatives for the photopolymer business, which may include divestitures, curtailment of investment or winding down of the business. As part of the Photopolymer Initiative, the Company assumed a shortened useful life on certain assets, including fixed assets, intangibles, and right of use assets, related to the photopolymer business and recorded $68.3 and $80.3 million in incremental depreciation and amortization as restructuring charges for the three and six months ended June 30, 2024. During the three and six months ended June 30, 2024, the Company recorded restructuring charges of $0.4 million and $0.9 million, respectively, related to employee severance and facility consolidations in connection with the Photopolymer Initiative.

During the six months ended June 30, 2024 and 2023, the Company recorded the following activity related to the 2022 and 2024 Initiatives in accrued expenses and other current liabilities on the balance sheet (in thousands):

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During the three and six months ended June 30, 2024 and 2023, the Company recognized the following restructuring charges which were expensed as follows (in thousands):

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