INDEBTEDNESS

12 Months Ended

Dec. 31, 2024

Debt Disclosure [Abstract]

INDEBTEDNESS

INDEBTEDNESS

Long-term debt consisted of the following as of December 31, 2024 (in thousands):

	Principal Amount		Discount		Debt Issuance Costs		Net Balance
Revolver Facility	$	—	$	—	$	—	$	—
First Lien Term Loan	631,617		(5,537)		(7,555)		618,525
Senior Notes	500,000		—		(7,372)		492,628
	$	1,131,617	$	(5,537)	$	(14,927)	1,111,153
Less: current portion							(6,512)
Total long-term debt							$	1,104,641

Long-term debt consisted of the following as of December 31, 2023 (in thousands):

	Principal Amount		Discount		Debt Issuance Costs		Net Balance
Revolver Facility	$	—	$	—	$	—	$	—
First Lien Term Loan	588,000		(6,974)		(9,678)		571,348
Senior Notes	500,000		—		(8,698)		491,302
	$	1,088,000	$	(6,974)	$	(18,376)	1,062,650
Less: current portion							(6,000)
Total long-term debt							$	1,056,650

On May 8, 2024, the Company entered into the Third Amendment to the amended and restated First Lien Credit Agreement dated as of October 27, 2021. The Third Amendment, among other things, (i) increases borrowings by $50.0 million and (ii) reduces the interest rate on the First Lien Term Loan from Term SOFR (including a credit spread adjustment) plus 2.75% to Term SOFR plus 2.25% and removes the credit spread adjustment with respect to such First Lien Term Loan.

The principal balance of the First Lien Term Loan is repayable in quarterly installments of $1.6 million plus interest, with a final payment of all remaining outstanding principal due on October 27, 2028. The quarterly principal payments commenced in March 2022. Under the Third Amendment, interest on the First Lien Term Loan is payable monthly on either (i) SOFR (with a floor of 0.50% per annum) plus an applicable margin of 2.25% for Term SOFR Loans (as such term is defined in the Third Amendment); or (ii) a base rate determined in accordance with the Third Amendment, plus 1.25% for Base Rate Loans (as such term is defined in the Third Amendment). The interest rate on the First Lien Term Loan was 6.82% and 8.21% as of December 31, 2024 and 2023, respectively. The weighted average interest rate incurred on the First Lien Term Loan was 7.61% and 7.83% for the years ended December 31, 2024 and 2023, respectively.

The Company assessed whether the repayment of the First Lien Term Loan indebtedness resulted in an insubstantial modification or an extinguishment of the existing debt for each loan in the syndication by grouping lenders as follows: (i) Lenders participating in both the First Lien Term Loan and Senior Notes; (ii) previous lenders that exited; and (iii) new lenders. The Company determined that $0.4 million of the First Lien Term Loan were extinguished. The First Lien Term Loan had insubstantial modifications for lenders that participated in both debt instruments, which resulted in a cash inflow from financing activities of $50.0 million in the consolidated statements of cash flows. The Company incurred $1.6 million in fees, of which $0.1 million was capitalized, relative to the First Lien Term Loan and an immaterial amount of the total fees incurred was netted against the $50.0 million of debt proceeds as financing activities within the consolidated statements of cash flows. The Company recognized a loss on extinguishment of debt of $0.4 million included in the line entitled “Other, net” in the consolidated statements of comprehensive income.

Effective June 30, 2023, the Company entered into an agreement, dated as of June 8, 2023, to amend the First Lien Term Loan to replace LIBOR and related definitions and provisions with SOFR as the new reference rate. The Company entered into the First Lien Term Loan Agreement (the “First Lien Credit Agreement Amendment”), which commenced in October 2021 (the “October 2021 Refinancing”) to provide $600.0 million of refinanced borrowings.

On December 7, 2023, the Company entered into the Second Amendment to the amended and restated First Lien Credit Agreement dated as of October 27, 2021. The Second Amendment, among other things, creates a Revolver Facility which provides for borrowings up to $400.0 million. As of December 31, 2024, the Company had $4.1 million of undrawn letters of credit issued and outstanding, resulting in net borrowing availability under the Revolver Facility of $395.9 million. As of December 31, 2023, the Company had $5.3 million of undrawn letters of credit issued and outstanding, resulting in net borrowing availability under the Revolver Facility of $394.7 million. The Revolver Facility matures on the date that is the earlier of (i) December 7, 2028 and (ii) the date that is 91 days prior to the stated maturity date applicable to any Term B Loans. Borrowings under the Revolver Facility bear interest at a rate equal to, at the option of the Company, either (i) the Term SOFR applicable thereto plus the Applicable Rate or (ii) the then-applicable Base Rate plus the Applicable Rate, which Applicable Rate shall be, subject to certain caveats thereto, as follows (i) until delivery of financial statements and related Compliance Certificate for the first full fiscal quarter ending after the effective date of the Second Amendment, (A) for Term SOFR Loans, 1.75%, or (B) for Base Rate Loans, 0.75% and (ii) thereafter, the Applicable Rate for Term SOFR Loans and Base Rate Loans, based upon the Total Net Leverage Ratio as set forth in the most recent Compliance Certificate received by the Administrative Agent pursuant to the terms of the Credit Agreement.

Concurrently with the creation of the Revolver Facility, the Company terminated the asset-based lending revolving credit facility (the “ABL Facility”) with a maturity date of October 27, 2026. Prior to the transition to the Revolver Facility, the ABL Facility had been in effect from August 6, 2019 to December 7, 2023. Effective January 13, 2023, the Company entered into an agreement to amend the ABL Facility and increase the amount of borrowing availability from $175.0 million by $50.0 million to $225.0 million total borrowing availability. As a result of the amended agreement, SOFR was established as the new reference rate, replacing LIBOR. Prior to the termination of the ABL Facility in December 2023, the ABL Facility bore interest at a rate equal to, at the Company’s election, either (i) a base rate determined in accordance with the ABL Credit Agreement plus an applicable margin, which is equal to between 0.25% and 0.75% based on the historical excess availability as a percentage of the Line Cap (as such term is defined in the ABL Credit Agreement); and (ii) SOFR (with a floor of —% per annum) plus an applicable margin, which is equal to between 1.25% and 1.75% based on the historical excess availability as a percentage of the Line Cap. The ABL Facility contained commitment fees payable on the unused portion ranging from 0.25% to 0.375%, depending on various factors including the Company’s leverage ratio, type of loan and rate type, and letter of credit fees of 2.50%. Borrowings under the ABL Facility were secured by a first priority security interest in the Company’s and each of its subsidiaries’ inventory, accounts receivable, cash, deposit accounts and certain assets and property related thereto (the “ABL Priority Collateral”), in each case subject to certain exceptions, and a third priority security interest in each of the Company’s subsidiaries’ capital stock (subject to certain exceptions) and substantially all of the Company’s property and assets (other than the ABL Priority Collateral).

In conjunction with the October 2021 Refinancing, the Company also issued $500.0 million in aggregate principal of unsecured senior notes (“Senior Notes”). The Senior Notes bear interest at a rate of 4.375% per annum payable semi-annually in arrears on October 31 and April 30 of each year, commencing on April 30, 2022. The Senior Notes mature on October 31, 2029. The interest rate on the Senior Notes was 4.375% as of both December 31, 2024 and 2023. The weighted average interest rate incurred on the Senior Notes was 4.375% for both years ended December 31, 2024 and 2023.

Long-term debt matures as follows (in thousands):

Fiscal Year Ended December 31,	Minimum Payments
2025	$	6,512
2026	6,512
2027	6,512
2028	612,081
2029	500,000
Total	$	1,131,617

During the year ended December 31, 2024, the Company engaged in hedging activities to limit its exposure to changes in interest rates. See Note 12, Derivative Instruments, for further discussion.

The following table presents the estimated fair values of the Company’s debt obligations as of December 31, 2024 (in thousands):

Financial Instrument	Carrying Value as of December 31, 2024		Markets for Identical Item (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
First Lien Term Loan	$	618,525	$	—	$	634,774	$	—
Senior Notes	492,628		—		460,000		—
Total debt instruments	$	1,111,153	$	—	$	1,094,774	$	—