Borrowing Facilities

6 Months Ended

Jun. 30, 2025

Debt Disclosure [Abstract]

Borrowing Facilities

Note 5 – Borrowing Facilities

Long-term debt consists of the following:

	June 30,			December 31,
(in thousands)	2025			2024
Revolving credit facility	$	60,000		$	135,000
Term loan		150,000			123,047
Less: unamortized debt issuance costs		(2,832	)		(1,027	)
Total long-term debt, including current installments	$	207,168		$	257,020

On June 27, 2025, the Company entered into a $700 million second amended and restated credit agreement (the Credit Agreement) by and among the Company, certain of its subsidiaries (the Guarantors), the lenders party thereto and Bank of America, N.A., as Administrative Agent, Swingline Lender and an L/C Issuer (Bank of America). The Credit Agreement is comprised of a five-year $550 million revolving credit facility (the Revolving Credit Facility) and a five-year $150 million term loan facility (the Term Loan Facility), both with a maturity date of June 27, 2030. In addition, the Credit Agreement permits the Company’s Malaysian subsidiary to enter into a term loan facility in the future for an additional principal aggregate amount not to exceed $50 million.

The Credit Agreement amended and restated in its entirety the Company’s previous $681.25 million amended and restated credit agreement, dated as of December 21, 2021, by and among the Company, the Guarantors, the lenders party thereto and Bank of America, as amended by Amendment No. 1, dated as of May 20, 2022, Amendment No. 2, dated as of February 3, 2023, and Amendment No. 3, dated as of May 1, 2023. As part of the debt refinancing transaction, the Company repatriated net dividends of $136.4 million to the United States from its operations in China and Thailand. This amount represents gross dividends of $151.6 million, less $15.2 million in withholding taxes paid in those jurisdictions. See Note 9 for further discussion about the repatriated dividends and impact on income tax expense. Such net dividends were used to reduce outstanding borrowings under the Company’s prior revolving credit facility.

The Credit Agreement includes an accordion feature pursuant to which the Company is permitted to add one or more incremental term loans and/or increase commitments under the Revolving Credit Facility in an aggregate amount not exceeding $175 million, subject to the satisfaction of certain conditions and exceptions.

The Revolving Credit Facility is available for general corporate purposes. Principal under the Term Loan Facility will amortize in equal quarterly installments of 0.625% of the initial aggregate term loan advances, beginning on September 30, 2025, through June 30, 2028. Thereafter, quarterly installments will increase to 1.25% of the initial aggregate term loan advances, continuing until the maturity date.

Interest on outstanding borrowings under the Credit Agreement (other than swingline loans) will accrue, at the Company’s option, at (a) Term Secured Overnight Financing Rate (Term SOFR) plus the Applicable Rate (as defined in the Credit Agreement, approximately 1.00% to 2.125% per annum depending on various factors) or (b) for U.S. dollar denominated loans, the base rate (which is the highest of (i) the federal funds rate plus 0.50%, (ii) the Bank of America, N.A. prime rate, (iii) Term SOFR plus 1.00% and (iv) 1.00%).

As of June 30, 2025, a portion of the $150.0 million outstanding debt under the Credit Agreement is effectively at a fixed interest rate of 4.039%, plus credit spread, resulting from a $119.8 million notional interest rate swap contract, which is discussed in Note 13. A commitment fee of 0.15% to 0.30% per annum (based on the debt to EBITDA ratio) on the unused portion of the Revolving Credit Facility is payable quarterly in arrears.

The Credit Agreement is generally secured by a pledge of (a) all the capital stock of the Company’s domestic subsidiaries and 65% of the capital stock of its directly owned foreign subsidiaries, (b) all of the present and future personal property and assets of the Company and the Guarantors (including, but not limited to, accounts receivable, inventory, intellectual property and fixed assets of the Company and the Guarantors), in each case, subject to customary exceptions and limitations, and (c) all proceeds and products of the property and assets described in clauses (a) and (b) above.

The Credit Agreement contains certain financial covenants related to interest coverage and debt leverage, and certain customary affirmative and negative covenants, including restrictions on the Company’s ability to incur additional debt and liens, pay dividends, repurchase shares, sell assets and merge or consolidate with other persons. Amounts due under the Credit Agreement may be accelerated upon customary specified events of default, including a failure to pay amounts due, breach of a covenant, material inaccuracy of a representation, or occurrence of bankruptcy or insolvency, subject, in some cases, to cure periods. As of June 30, 2025, the Company was in compliance with all of these covenants and restrictions.

As of June 30, 2025, the Company had $150.0 million in borrowings outstanding under the Term Loan Facility, $60.0 million in borrowings outstanding under the Revolving Credit Facility, and $4.4 million in letters of credit outstanding under the Revolving Credit Facility. As of June 30, 2025, the Company had $485.6 million available for future borrowings under the Revolving Credit Facility subject to compliance with financial covenants as to interest coverage and debt leverage, in addition to other debt covenant restrictions.