Debt

3 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

Debt

9.    Debt

During fiscal 2024, the Company amended its New Revolving Credit Facility increasing the size of the New Revolving Credit Facility by $75,000,000 to a total of $175,000,000. The Company borrowed against the expanded New Revolving Credit

Facility in May of fiscal 2024 to initially fund the montratec acquisition as described in Note 2. The Company subsequently borrowed additional funds in accordance with the Accordion feature under its existing Term Loan B facility to increase the principal amount of the Term Loan B facility by $75,000,000. The Company also borrowed an additional $45,000,000 under a new credit agreement secured by the Company's U.S. accounts receivable balances (the "AR Securitization Facility"). The total U.S. accounts receivable balances which secure the AR Securitization Facility total $80,441,000. The Company used the proceeds from the $75,000,000 Accordion borrowing and the $45,000,000 AR Securitization Facility to fully repay borrowings on the New Revolving Credit Facility prior to June 30, 2023.

The key terms of the new AR Securitization Facility are as follows:

•The AR Securitization Facility Agreement provides for revolving loans to be made up to a maximum principal amount of $55,000,000 of which $45,000,000 was drawn as of June 30, 2023.

•The AR Securitization Facility borrowings bear interest at a floating rate initially equal to a one-month secured overnight funding rate (SOFR) plus 10 basis points of credit spread adjustment, plus 110 basis points.

•The AR Securitization Facility borrowings are secured by the Company's U.S. accounts receivables totaling $80,441,000 at June 30, 2023.

•The AR Securitization Facility Agreement contains customary events of default (referred to as “Amortization Events.”)

•Amounts drawn under the AR Securitization Facility may remain outstanding until the maturity date of the AR Securitization Facility on June 19, 2026. Prior to the maturity date, the Company is only required to repay principal to the extent necessary to maintain borrowing base compliance, unless an Amortization Event occurs.

As of June 30, 2023 there have been no Amortization Events triggered in the AR Securitization Facility. The Company has both the ability and intent to have the AR Securitization Facility remain outstanding for the next 12-months. As such, the Company has classified the full $45,000,000 outstanding borrowings under the AR Securitization Facility as long-term debt at June 30, 2023.

In addition to the above, the Company amended the variable interest component of its Term Loan B and New Revolving Credit Facility to transition from LIBOR to SOFR.

The outstanding principal balance of the Term Loan B facility was $527,560,000 as of June 30, 2023, which includes $75,000,000 in principal balance from the Accordion exercised in the first quarter of fiscal 2024 as described above. The Company made $10,000,000 in principal payments on the Term Loan B facility during the three months ended June 30, 2023 of which $1,529,000 was required. The Company is obligated to make $6,116,000 of principal payments on the Term Loan B facility over the next 12 months plus applicable Excess Cash Flow ("ECF") payments, if required, however, plans to pay down approximately $40,000,000 in principal payments in total during such 12 month period. This amount has been recorded within the current portion of long-term debt on the Company's Condensed Consolidated Balance Sheet with the remaining balance recorded as long-term debt. Refer to the 2023 10-K for further details on the Company's Term Loan B facility.

There were no outstanding borrowings and $15,837,000 in outstanding letters of credit issued against the New Revolving Credit Facility as of June 30, 2023.  The outstanding letters of credit as of June 30, 2023 consisted of $473,000 in commercial letters of credit and $15,364,000 of standby letters of credit.

The gross balance of deferred financing costs on the Term Loan B facility was $7,718,000, which includes $2,286,000 from the Accordion exercises, as of June 30, 2023 and $6,323,000, which includes $892,000 from the Accordion exercise, as of March 31, 2023. The accumulated amortization balances were $2,048,000 and $1,815,000 as of June 30, 2023 and March 31, 2023, respectively. The gross balance of deferred financing costs associated with the AR Securitization Facility was $533,000 with an accumulated amortization balance of $15,000 as of June 30, 2023.

The gross balance of deferred financing costs associated with the New Revolving Credit Facility is $4,826,000 as of June 30, 2023 and $4,027,000 as of March 31, 2023, respectively, which are included in Other assets on the Condensed Consolidated Balance Sheet. The $799,000 increase in Fiscal 2024 relates to fees paid to increase the size of the New Revolving Credit Facility to $175,000,000 as described above. The accumulated amortization balances were $1,846,000 and $1,611,000 as of June 30, 2023 and March 31, 2023, respectively.

The Company has a finance lease for a manufacturing facility in Hartland, WI under a 23-year lease agreement which terminates in 2035. The outstanding balance on the finance lease obligation is $13,397,000 as of June 30, 2023 of which $619,000 has been recorded within the Current portion of long-term debt and the remaining balance recorded within the Term

loan, AR securitization facility and finance lease obligations on the Company's Condensed Consolidated Balance Sheet. See Note 15 for further details.

Unsecured and uncommitted lines of credit are available to meet short-term working capital needs for certain of our subsidiaries operating outside of the U.S. The lines of credit are available on an offering basis, meaning that transactions under the line of credit will be on such terms and conditions, including interest rate, maturity, representations, covenants and events of default, as mutually agreed between our subsidiaries and the local bank at the time of each specific transaction. As of June 30, 2023, unsecured credit lines totaled approximately $2,400,000, of which nothing was drawn. In addition, unsecured lines of $12,813,000 were available for bank guarantees issued in the normal course of business of which $12,474,000 was utilized as of June 30, 2023.

Refer to the Company’s consolidated financial statements included in its 2023 10-K for further information on its debt arrangements.