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Note 6. Credit Facilities (Details)
$ in Thousands, € in Millions
2 Months Ended 9 Months Ended
Mar. 31, 2023
USD ($)
Mar. 31, 2023
USD ($)
Mar. 31, 2023
EUR (€)
Jun. 30, 2022
USD ($)
Line of Credit Facility        
Line of Credit Facility, Remaining Borrowing Capacity $ 98,100 $ 98,100    
Long-term Line of Credit 289,400 289,400   $ 180,600
Current portion of borrowings under credit facilities 54,420 54,420   35,580
Long-term debt under credit facilities, less current portion $ 235,000 $ 235,000   $ 145,000
Debt, Weighted Average Interest Rate 6.60% 6.60% 6.60% 2.70%
Primary Credit Facility        
Line of Credit Facility        
Line of Credit Facility, Remaining Borrowing Capacity [1] $ 20,600 $ 20,600    
Long-term Line of Credit [1] 279,000 279,000   $ 171,400
Long-term debt under credit facilities, less current portion [2] 235,000 235,000   145,000
Line of Credit Facility, Maximum Borrowing Capacity 300,000 300,000    
Line of Credit Facility, Maximum Borrowing Capacity Upon Request 450,000 $ 450,000    
Line of Credit Facility, Above the Adjusted SOFR Rate to Calculate Alternate Base Rate   1.00%    
Adjusted Leverage Ratio Covenant   3.0    
Adjusted Leverage Ratio, Indebtedness Reduction For Excess Cash 15,000 $ 15,000    
Line of Credit Facility, Above the Federal Funds Rate to Calculate Alternate Base Rate   0.50%    
Adjusted Leverage Ratio Covenant Material Acquisition   3.5    
Interest Coverage Ratio Covenant   3.5    
Thailand Overdraft Credit Facility        
Line of Credit Facility        
Line of Credit Facility, Remaining Borrowing Capacity [3] 10,100 $ 10,100    
Current portion of borrowings under credit facilities [3] 0 0   0
Line of Credit Facility, Maximum Borrowing Capacity 10,100 10,100    
China Revolving Credit Facility        
Line of Credit Facility        
Line of Credit Facility, Remaining Borrowing Capacity [4] 7,500 7,500    
Current portion of borrowings under credit facilities [4] 0 0   0
Line of Credit Facility, Maximum Borrowing Capacity 7,500 7,500    
Netherlands Revolving Credit Facility        
Line of Credit Facility        
Line of Credit Facility, Remaining Borrowing Capacity 600 600    
Current portion of borrowings under credit facilities 9,300 9,300   9,200
Poland Revolving Credit Facility        
Line of Credit Facility        
Line of Credit Facility, Remaining Borrowing Capacity [5] 5,400 5,400    
Current portion of borrowings under credit facilities [5] 0 0   0
Line of Credit Facility, Maximum Borrowing Capacity 5,400 5,400 € 5.0  
Secondary Credit Facility        
Line of Credit Facility        
Line of Credit Facility, Remaining Borrowing Capacity [6] 50,000 50,000    
Current portion of borrowings under credit facilities [6] 0 0   0
Line of Credit Facility, Maximum Borrowing Capacity $ 50,000 50,000    
Line of Credit Facility, Commitment Fee Percentage 0.30%      
Line of Credit Facility, Term Benchmark Loans Spread for SOFR 0.01750      
Line of Credit Facility, Term Benchmark Loans Spread for EURIBOR 0.01750      
Line of Credit Facility, Above the Adjusted SOFR Rate to Calculate Alternate Base Rate 1.00%      
Adjusted Leverage Ratio Covenant 3.0      
Line of Credit Facility, Alternate Base Rate Loans Spread 0.00750      
Adjusted Leverage Ratio, Indebtedness Reduction For Excess Cash $ 15,000 15,000    
Line of Credit Facility, Above the Federal Funds Rate to Calculate Alternate Base Rate 0.50%      
Adjusted Leverage Ratio Covenant Material Acquisition 3.5      
Interest Coverage Ratio Covenant 3.5      
Vietnam Credit Facility        
Line of Credit Facility        
Line of Credit Facility, Remaining Borrowing Capacity [7] $ 3,900 3,900    
Current portion of borrowings under credit facilities [7] 1,100 1,100   0
Line of Credit Facility, Maximum Borrowing Capacity 5,000 5,000    
Financial Standby Letter of Credit        
Line of Credit Facility        
Guarantor Obligations, Maximum Exposure, Undiscounted $ 400 $ 400   $ 400
Minimum | Primary Credit Facility        
Line of Credit Facility        
Line of Credit Facility, Commitment Fee Percentage   0.10%    
Line of Credit Facility, Term Benchmark Loans Spread for SOFR   0.01000    
Line of Credit Facility, Term Benchmark Loans Spread for EURIBOR   0.01000    
Line of Credit Facility, Alternate Base Rate Loans Spread   0.00000    
Maximum | Primary Credit Facility        
Line of Credit Facility        
Line of Credit Facility, Commitment Fee Percentage   0.25%    
Line of Credit Facility, Term Benchmark Loans Spread for SOFR   0.01750    
Line of Credit Facility, Term Benchmark Loans Spread for EURIBOR   0.01750    
Line of Credit Facility, Alternate Base Rate Loans Spread   0.00750    
[1] The Company maintains a U.S. primary credit facility (the “primary credit facility”) among the Company, the lenders party thereto, and JPMorgan Chase Bank, N. A., as Administrative Agent, and Bank of America, N.A., as Documentation Agent, scheduled to mature May 4, 2027. The primary credit facility provides for $300 million in borrowings, with an option to increase the amount available for borrowing to $450 million upon request, subject to the consent of each lender participating in such increase. This facility is maintained for working capital and general corporate purposes of the Company. A commitment fee is payable on the unused portion of the credit facility at a rate that ranges from 10.0 to 25.0 basis points per annum as determined by the Company’s ratio of consolidated total indebtedness to adjusted consolidated EBITDA, as defined in the primary credit facility. Types of borrowings available on the primary credit facility include revolving loans, multi-currency term loans, and swingline loans.
The interest rate on borrowings is dependent on the type and currencies of borrowings and will be one of the following options:
any Term Benchmark borrowing denominated in U.S. Dollars will utilize the Secured Overnight Financing Rate (“SOFR”), which is a rate per annum equal to the secured overnight financing rate for such business day published by the SOFR Administrator, the Federal Reserve Bank of New York, on the immediately succeeding business day, plus the Revolving Commitment Term Benchmark spread which can range from 100.0 to 175.0 basis points based on the Company’s ratio of consolidated total indebtedness to adjusted consolidated EBITDA;
any Term Benchmark borrowing denominated in Euros will utilize the Euro Interbank Offered Rate (“EURIBOR”) in effect two target days prior to the advance (adjusted upwards to reflect bank reserve costs) for such interest period as defined in the agreement, plus the Revolving Commitment Term Benchmark spread which can range from 100.0 to 175.0 basis points based on the Company’s ratio of consolidated total indebtedness to adjusted consolidated EBITDA; or
the Alternate Base Rate (“ABR”), which is defined as the highest of the fluctuating rate per annum equal to the higher of:
a.Prime Rate in the U.S. last quoted by the Wall Street Journal, and if this is ceased to be quoted, the highest bank prime loan rate or similar loan rate quoted by the Federal Reserve Board;
b.1/2 of 1% per annum above the Federal Funds Effective Rate (as defined under the primary credit facility); or
c.1% per annum above the Adjusted SOFR Rate (as defined under the primary credit facility);
plus the Revolving Commitment ABR spread which can range from 0.0 to 75.0 basis points based on the Company’s ratio of consolidated total indebtedness to adjusted consolidated EBITDA.
The Company’s financial covenants under the primary credit facility require:
a ratio of consolidated total indebtedness minus unencumbered U.S. cash on hand in the United States in excess of $15 million to adjusted consolidated EBITDA, determined as of the end of each of its fiscal quarters for the then most recently ended four fiscal quarters, to not be greater than 3.0 to 1.0, provided, however, that for each fiscal quarter end during the four quarter period following a material permitted acquisition, as defined in the Credit Agreement, the Company will not permit this financial covenant to be greater than 3.5 to 1.0 for each such fiscal quarter end, and,
an interest coverage ratio, defined as that ratio of consolidated EBITDA for such period to cash interest expense for such period, for any period of four consecutive fiscal quarters, to not be less than 3.5 to 1.0.
The Company had $0.4 million in letters of credit contingently committed against the credit facility at both March 31, 2023 and June 30, 2022.
[2] The amount of Long-term debt under credit facilities, less current maturities reflects the borrowings on the primary credit facility that the Company intends, and has the ability, to refinance for a period longer than twelve months. The primary credit facility matures on May 4, 2027.
[3] During the first quarter of fiscal year 2023, the Company expanded the borrowing capacity of the Thailand credit facility to $10.1 million.
[4] The Company entered into a foreign credit facility for its EMS operation in China during the first quarter of fiscal year 2023 which allows for borrowings up to $7.5 million.
[5] The Company entered into a foreign credit facility for its operation in Poland which allows for borrowings up to 5.0 million Euro (approximately $5.4 million equivalent).
[6] The Company entered into a 364-day multi-currency revolving credit facility agreement on February 3, 2023 (the “secondary credit facility”), which allows for borrowings up to $50 million, among the Company, as borrower, certain subsidiaries of the Company as guarantors, the lenders party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent and Bank of America, N.A., as Documentation Agent. The secondary credit facility has a maturity date of February 2, 2024. The proceeds of the loans are to be used for working capital and general corporate purposes of the Company. A commitment fee on the unused portion of principal amount of this secondary credit facility is payable at 30.0 basis points per annum.
The interest rate on borrowings is dependent on the type of borrowings and will be one of the following options:
any Term Benchmark borrowing denominated in U.S. Dollars will utilize the Secured Overnight Financing Rate (“SOFR”), which is a rate per annum equal to the secured overnight financing rate for such business day published by the SOFR Administrator, the Federal Reserve Bank of New York, on the immediately succeeding business day, plus a Revolving Commitment Term Benchmark spread of 175.0 basis points;
any Term Benchmark borrowing denominated in Euros will utilize the Euro Interbank Offered Rate (“EURIBOR”) in effect two target days prior to the advance (adjusted upwards to reflect bank reserve costs) for such interest period as defined in the agreement, plus a Revolving Commitment Term Benchmark spread of 175.0 basis points; or
the Alternate Base Rate (“ABR”), which is defined as the highest of the fluctuating rate per annum equal to the higher of:
a.Prime Rate in the U.S. last quoted by the Wall Street Journal, and if this is ceased to be quoted, the highest bank prime loan rate or similar loan rate quoted by the Federal Reserve Board;
b.1/2 of 1% per annum above the Federal Funds Effective Rate (as defined under the primary credit facility); or
c.1% per annum above the Adjusted SOFR Rate (as defined under the primary credit facility);
plus a Revolving Commitment ABR spread of 75.0 basis points.
The Company’s financial covenants under this secondary credit facility are the same as the financial covenants for its primary credit facility.
[7] The Company entered into a foreign credit facility for its operation in Vietnam which allows for borrowings up to $5.0 million.