Debt

9 Months Ended

Sep. 30, 2025

Debt Disclosure [Abstract]

Debt

6. Debt

In May 2025, the Company, as borrower, entered into a Credit Agreement with Citibank, as administrative agent, collateral agent and a lender, and certain other financial institutions, as lenders (the facility established thereby, the “Revolving Credit Facility”). The Revolving Credit Facility, which matures in May 2030, provides the Company with revolving commitments in an aggregate principal amount of $200.0 million, with a $10.0 million sublimit for the issuance of letters of credit and a $10.0 million sublimit for swingline borrowings. The Company, subject to the satisfaction of certain conditions, including obtaining commitments from new or existing lenders, may increase the commitments under the Revolving Credit Facility by an aggregate principal amount of up to the greater of $100.0 million or 100% of trailing twelve months adjusted EBITDA (calculated in accordance with the terms of the Revolving Credit Facility). The obligations of the Company under the Revolving Credit Facility are secured on a first priority basis by a lien on substantially all of the assets of the Company.

Borrowings under the Revolving Credit Facility bear interest through maturity and, at the Company’s election, at a variable rate based upon either (i) an adjusted term SOFR rate (based on one-, three- or six-month interest periods), plus an applicable margin (“SOFR Borrowings”) or (ii) an alternative base rate, plus an applicable margin (“ABR Borrowings”). The applicable margin for SOFR Borrowings is between 2.0% and 2.5%, and the applicable margin for ABR Borrowings is between 1.0% to 1.5%, in each case depending on the Company’s consolidated net leverage ratio calculated in accordance with the terms of the Revolving Credit Facility. The Revolving Credit Facility bears a commitment fee on the daily undrawn amount of revolving commitments ranging from 0.25% to 0.35% per annum payable quarterly in arrears, depending on the Company’s consolidated total net leverage ratio.

The Revolving Credit Facility contains customary affirmative and negative covenants, including negative covenants imposing limitations on, among others, incurring additional indebtedness, granting liens, making certain restricted payments (including stock repurchases or the payment of cash dividends), making investments and entering into certain transactions with affiliates. The Company is also subject to financial covenants to maintain a minimum consolidated interest coverage ratio of 3.0 to 1.0 and a maximum consolidated net leverage ratio of 3.5 to 1.0, in each case calculated in accordance with the terms of the Revolving Credit Facility. Noncompliance with these covenants, or the occurrence of certain other events specified in the Revolving Credit Facility, could result in an event of default under the Revolving Credit Facility. Upon the occurrence and during the continuance of an event of default, any outstanding principal, interest, and fees could become immediately due and payable. As of September 30, 2025, the Company was in compliance with all covenants under the Revolving Credit Facility.

As of September 30, 2025, the Company had no outstanding borrowings under the Revolving Credit Facility.

The Company incurred $1.4 million worth of debt issuance costs in connection with the Revolving Credit Facility. The Company recorded interest expense of $0.2 million and $0.3 million during the three and nine months ended September 30, 2025, respectively, of which $0.1 million was related to the amortization of capitalized debt issuance costs for both the three and nine months ended September 30, 2025.