Commercial Vehicle Group, Inc. 10-K

Item 8. Financial Statements and Supplementary Data INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Documents Filed as Part of this Annual Report on Form 10-K Page Report of Independent Registered Public Accounting Firm 39 Consolidated Balance Sheets as of December 31, 2020 and 2019 42 Consolidated Statements of Operations for the years ended December 31, 2020, 2019 and 2018 43 Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2020, 2019 and 2018 44 Consolidated Statements of Stockholders’ Equity for the years ended December 31, 20 20 , 201 9 and 201 8 45 Consolidated Statements of Cash Flows for the years ended December 31, 2020, 2019 and 2018 46 Notes to Consolidated Financial Statements 47 Item 15 - Exhibits and Financial Statement Schedules 84 38 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and Board of Directors Commercial Vehicle Group, Inc.: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Commercial Vehicle Group, Inc. and subsidiaries (the Company) as of December 31, 2020 and 2019, the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity, and cash flows for each of the years in the three‑year period ended December 31, 2020, and the related notes to the consolidated financial statements (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the years in the three‑year period ended December 31, 2020, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated March 9, 2021 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting. Change in Accounting Principle As discussed in Note 1 to the consolidated financial statements, the Company has changed its method of accounting for leases as of January 1, 2019 due to the adoption of Accounting Standards Update (ASU) No. 2016-12, Leases (Topic 842). Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Testing of revenue As discussed in Note 2 to the consolidated financial statements, revenue is recognized when a performance obligation has been satisfied and control of products has been transferred to the customer, usually at a designated shipping point and in accordance with customer specifications. Revenue is measured based on the amount of consideration the Company expects to receive in exchange for the transfer of goods or services. For the year ended December 31, 2020, the Company recorded $717.7 million of revenue. 39 Table of Contents We identified the testing of revenue as a critical audit matter due to the large volume of data and the number and complexity of the revenue accounting systems. While revenues consist of a large number of similar, individually low value transactions, the processing and recording of revenue is reliant upon multiple information technology (IT) systems used to process large volumes of customer billing data. Specialized skills and knowledge were needed to test the IT systems used for the processing and recording of revenue. The following are the primary procedures we performed to address this critical audit matter. We applied auditor judgment to determine the nature and extent of procedures to be performed over revenue. We evaluated the design and tested the operating effectiveness of certain internal controls related to the processing and recording of revenue. This included controls over the IT systems and automated and manual process level controls related to the processing and recording of revenue. For a selection of transactions, we (1) compared the amount of revenue recorded to a combination of Company internal data, executed contracts, and other relevant and reliable third-party data, including cash received from customers and (2) evaluated the timing of revenue recognition based on the shipment date. In addition, we involved IT professionals with specialized skills and knowledge, who assisted in the identification and testing of certain IT systems used by the Company for the processing and recording of revenue. We evaluated the sufficiency of audit evidence obtained by assessing the results of procedures performed, including the appropriateness of the nature and extent of the audit effort. Goodwill impairment As discussed in Note 4, goodwill represents the excess of acquisition purchase price over the fair value of net assets acquired in a business combination. During the first quarter of 2020, as a result of the Company’s market capitalization value being less than the carrying value of its equity for a duration of time, the Company determined it had an impairment indicator. Accordingly, the Company estimated the fair value of each of the reporting units with goodwill by discounting the estimated cash flows of each reporting unit. The estimated fair values of the reporting units were then compared to their net carrying values as of March 31, 2020 and, as a result, the Company recognized $27.1 million impairment of goodwill, which represented the carrying amount of goodwill prior to the impairment charge. We identified the evaluation of the goodwill impairment analysis for each reporting unit with goodwill as a critical audit matter. The fair value of each reporting unit was based on a discounted cash flow model, which involved estimation uncertainty in the projection of future cash flows, resulting in an increased level of subjective auditor judgment. We determined the revenue growth rates and discount rate assumptions represented the significant assumptions. Evaluation of the revenue growth rates and discount rate assumptions used to estimate the fair value of the reporting units was challenging as they represented subjective determinations of future market and economic conditions that were also sensitive to variation. Additionally, the audit effort associated with this estimate required specialized skills and knowledge. The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the goodwill impairment analysis. This included controls related to the Company’s determination of the estimated fair value of the reporting units over the: • development of the revenue growth rate assumptions • selection of the discount rate assumptions used to develop the estimate • reconciliation of the aggregate reporting unit fair values to the Company’s market capitalization. We evaluated the reasonableness of the Company’s forecasted revenue growth rates for the reporting units by comparing the growth assumptions to forecasted growth rates in analyst reports for the Company and industry reports. We compared the Company’s historical revenue forecasts to actual results to assess the Company’s ability to accurately forecast. In addition, we involved valuation professionals with specialized skills and knowledge, who assisted in: • evaluating the discount rates used by management in the valuation, by comparing them against discount rate ranges that were independently developed using publicly available market data for comparable entities • developing estimates of each reporting unit’s fair value using each reporting unit’s cash flow forecast and an independently developed discount rate, and comparing the results of these estimates of fair value to the Company’s fair value estimates • evaluating the Company’s reconciliation of the aggregate reporting unit fair values to the Company’s market capitalization and assessing the reasonableness of the resulting implied premium by comparing it to a range of premiums from recent transactions in the Company’s industry. 40 Table of Contents /s/ KPMG LLP We have served as the Company’s auditor since 2012. Columbus, Ohio March 9, 2021 41 Table of Contents COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS December 31, 2020 and 2019 2020 2019 ASSETS (in thousands, except share and per share amounts) Current assets: Cash $ 50,503 $ 39,511 Accounts receivable, net of allowances of $ 644 and $ 433 , respectively 151,101 115,099 Inventories 91,247 82,872 Other current assets 17,686 18,490 Total current assets 310,537 255,972 Property, plant and equipment, net of accumulated depreciation of $ 159,026 and $ 154,939 , respectively 62,776 73,686 Operating lease right-of-use asset, net 30,047 34,960 Goodwill — 27,816 Intangible assets, net of accumulated amortization of $ 14,831 and $ 11,440 , respectively 21,804 25,258 Deferred income taxes, net 25,981 14,654 Other assets 3,228 3,480 TOTAL ASSETS $ 454,373 $ 435,826 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 112,402 $ 63,058 Current operating lease liabilities 9,236 7,620 Accrued liabilities and other 40,820 32,673 Current portion of long-term debt 2,429 3,256 Total current liabilities 164,887 106,607 Long-term debt 144,147 153,128 Long-term operating lease liabilities 23,932 29,414 Pension and other post-retirement liabilities 15,296 10,666 Other long-term liabilities 10,741 7,323 Total liabilities 359,003 307,138 Stockholders’ equity: Preferred stock, $ 0.01 par value ( 5,000,000 shares authorized; no shares issued and outstanding) — — Common stock, $ 0.01 par value ( 60,000,000 shares authorized; 31,249,811 and 30,801,255 shares issued and outstanding, respectively) 313 323 Treasury stock, at cost: 1,560,623 and 1,464,392 shares, respectively ( 11,893 ) ( 11,230 ) Additional paid-in capital 249,312 245,852 Retained deficit ( 97,356 ) ( 60,307 ) Accumulated other comprehensive loss ( 45,006 ) ( 45,950 ) Total stockholders’ equity 95,370 128,688 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 454,373 $ 435,826 The accompanying notes are an integral part of these consolidated financial statements. 42 Table of Contents COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS Years Ended December 31, 2020, 2019 and 2018 2020 2019 2018 (In thousands, except per share amounts) Revenues $ 717,699 $ 901,238 $ 897,737 Cost of revenues 643,623 796,101 772,817 Gross profit 74,076 105,137 124,920 Selling, general and administrative expenses 64,794 62,549 60,679 Goodwill and other impairment 29,017 — — Amortization expense 3,434 1,952 1,300 Operating income (loss) ( 23,169 ) 40,636 62,941 Other (expense) income ( 728 ) ( 2,225 ) 1,311 Interest expense 20,603 16,855 14,676 Income (loss) before provision for income taxes ( 44,500 ) 21,556 49,576 Provision (benefit) for income taxes ( 7,451 ) 5,778 8,087 Net income (loss) $ ( 37,049 ) $ 15,778 $ 41,489 Earnings (loss) per common share Basic $ ( 1.20 ) $ 0.52 $ 1.37 Diluted $ ( 1.20 ) $ 0.51 $ 1.36 Weighted average shares outstanding Basic 30,943 30,602 30,277 Diluted 30,943 30,823 30,587 The accompanying notes are an integral part of these consolidated financial statements. 43 Table of Contents COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) Years Ended December 31, 2020, 2019 and 2018 2020 2019 2018 (In thousands) Net income (loss) $ ( 37,049 ) $ 15,778 $ 41,489 Other comprehensive income (loss): Foreign currency translation adjustments 5,008 ( 1,185 ) ( 5,675 ) Minimum pension liability, net of tax ( 5,041 ) 2,738 ( 1,057 ) Derivative instruments, net of tax 977 ( 32 ) 496 Other comprehensive income (loss) 944 1,521 ( 6,236 ) Comprehensive income (loss) $ ( 36,105 ) $ 17,299 $ 35,253 The accompanying notes are an integral part of these consolidated financial statements. 44 Table of Contents COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY Years Ended December 31, 2020, 2019 and 2018 Common Stock Treasury Stock Additional Paid-In Capital Retained Deficit Accum. Other Comp. Loss Total CVG Stockholders’ Equity Shares Amount (In thousands, except share data ) Balance - December 31, 2017 30,219,278 $ 304 $ ( 9,114 ) $ 239,870 $ ( 117,502 ) $ ( 41,235 ) $ 72,323 Issuance of restricted stock 452,021 14 — — — 14 Surrender of common stock by employees ( 158,456 ) — ( 1,131 ) — — — ( 1,131 ) Share-based compensation expense — — — 3,137 — — 3,137 Total comprehensive income — — — — 41,489 ( 6,236 ) 35,253 Balance - December 31, 2018 30,512,843 $ 318 $ ( 10,245 ) $ 243,007 $ ( 76,013 ) $ ( 47,471 ) $ 109,596 Issuance of restricted stock 418,553 5 — — — — 5 Surrender of common stock by employees ( 130,141 ) — ( 985 ) — — — ( 985 ) Share-based compensation expense — — — 2,845 — — 2,845 Cumulative effect of adoption of Topic 842 — — — — ( 72 ) — ( 72 ) Total comprehensive income — — — — 15,778 1,521 17,299 Balance - December 31, 2019 30,801,255 $ 323 $ ( 11,230 ) $ 245,852 $ ( 60,307 ) $ ( 45,950 ) $ 128,688 Issuance of restricted stock 544,787 ( 10 ) — — — — ( 10 ) Surrender of common stock by employees ( 96,231 ) — ( 663 ) — — — ( 663 ) Share-based compensation expense — — — 3,460 — — 3,460 Total comprehensive income (loss) — — — — ( 37,049 ) 944 ( 36,105 ) Balance - December 31, 2020 31,249,811 $ 313 $ ( 11,893 ) $ 249,312 $ ( 97,356 ) $ ( 45,006 ) $ 95,370 The accompanying notes are an integral part of these consolidated financial statements. 45 Table of Contents COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended December 31, 2020, 2019 and 2018 2020 2019 2018 (In thousands) CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $ ( 37,049 ) $ 15,778 $ 41,489 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 18,493 15,514 15,270 Impairment expense 29,017 — — Noncash amortization of debt financing costs 1,929 1,393 1,404 Payment in kind interest expense 5,431 — — Shared-based compensation expense 3,460 2,843 3,137 Deferred income taxes ( 12,129 ) 1,562 5,031 Noncash loss (gain) on forward exchange contracts 299 1,972 ( 1,468 ) Change in other operating items: Accounts receivable ( 34,284 ) 18,815 ( 27,380 ) Inventories ( 6,828 ) 9,495 4,836 Prepaid expenses 2,896 ( 1,793 ) ( 2,292 ) Accounts payable 48,046 ( 24,261 ) 1,451 Accrued liabilities 8,650 ( 3,525 ) 2,631 Other operating activities, net 6,441 ( 1,047 ) ( 3,117 ) Net cash provided by operating activities 34,372 36,746 40,992 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property, plant and equipment ( 7,142 ) ( 24,002 ) ( 14,150 ) Proceeds from disposal/sale of property, plant and equipment 722 23 49 Payments for acquisition of business — ( 34,000 ) — Net cash used in investing activities ( 6,420 ) ( 57,979 ) ( 14,101 ) CASH FLOWS FROM FINANCING ACTIVITIES: Borrowings of revolving credit facility 15,000 35,700 80,500 Repayment of revolving credit facility ( 15,000 ) ( 35,700 ) ( 80,500 ) Repayment of term loan facility ( 14,375 ) ( 8,525 ) ( 4,375 ) Early payment fee on debt and other debt issuance costs ( 2,779 ) ( 160 ) — Surrender of common stock by employees ( 663 ) ( 985 ) ( 1,131 ) Contingent consideration payment ( 1,000 ) — — Other financing activities, net ( 445 ) ( 443 ) ( 329 ) Net cash used in financing activities ( 19,262 ) ( 10,113 ) ( 5,835 ) EFFECT OF CURRENCY EXCHANGE RATE CHANGES ON CASH 2,302 ( 56 ) ( 2,387 ) NET INCREASE (DECREASE) IN CASH 10,992 ( 31,402 ) 18,669 CASH: Beginning of period 39,511 70,913 52,244 End of period $ 50,503 $ 39,511 $ 70,913 SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid for interest $ 12,193 $ 13,873 $ 14,046 Cash paid for income taxes, net $ 2,483 $ 8,774 $ 3,143 Unpaid purchases of property and equipment included in accounts payable $ 131 $ 624 $ 509 The accompanying notes are an integral part of these consolidated financial statements. 46 Table of Contents COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years Ended December 31, 2020, 2019 and 2018 1. Significant Accounting Policies Organization - Commercial Vehicle Group, Inc. and its subsidiaries is a global provider of components and assemblies into two primary end markets – the global vehicle market and the U.S. technology integrator markets. The company provides components and assemblies to global vehicle companies to build original equipment and provides aftermarket products for fleet owners. The company also provides mechanical assemblies to warehouse automation integrators and to U.S. military technology integrators. References herein to the "Company", "CVG", "we", "our", or "us" refer to Commercial Vehicle Group, Inc. and its subsidiaries. We have manufacturing operations in the United States, Mexico, China, United Kingdom, Belgium, Czech Republic, Ukraine, Thailand, India and Australia. Our products are primarily sold in North America, Europe, and the Asia-Pacific region. We primarily manufacture customized products on a sequenced basis to meet the requirements of our customers. We believe our trucking products are used by a majority of the North American Commercial Truck markets, many construction vehicle original equipment manufacturers (“OEMs”), and many of the top e-commerce retailers. We report our financial results by business segment; more specifically, Electrical Systems and Global Seating. The Company’s Chief Operating Decision Maker (“CODM”), its President and Chief Executive Officer, reviews financial information for these two reportable segments and makes decisions regarding the allocation of resources based on these segments. See Note 17, Segment Reporting, for more information. Unless otherwise indicated, all amounts in the tables below are in thousands, except share and per share amounts. Principles of Consolidation - The accompanying consolidated financial statements include the accounts of our wholly-owned or controlled subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ materially from those estimates. Certain prior period amounts have been reclassified to conform to footnote presentation for the current year. Cash - Cash consists of deposits with high credit-quality financial institutions. Accounts Receivable - Trade accounts receivable are stated at current value less allowances, which approximates fair value. We review our receivables on an ongoing basis to ensure that they are properly valued and collectible. The allowance for credit losses is used to record the estimated risk of loss related to our customers’ inability to pay. This allowance is maintained at a level that we consider appropriate based on factors that affect collectability, such as the financial health of our customers, historical trends of charge-offs and recoveries and current and expected economic market conditions. As we monitor our receivables, we identify customers that may have payment problems, and we adjust the allowance accordingly, with the offset to selling, general and administrative expense. Account balances are charged off against the allowance when recovery is considered remote. Inventories - Inventories are valued at the lower of first-in, first-out cost or market and are measured at the lower of cost or net realizable value. Inventory quantities on-hand are regularly reviewed and when necessary provisions for excess and obsolete inventory are recorded based primarily on our estimated production requirements, taking into consideration expected market volumes and future potential use. 47 Table of Contents Inventories consisted of the following as of December 31: 2020 2019 Raw materials $ 65,334 $ 57,742 Work in process 13,373 12,612 Finished goods 12,540 12,518 Total Inventory $ 91,247 $ 82,872 Property, Plant and Equipment - Property, plant and equipment are stated at cost, net of accumulated depreciation. Property, plant, and equipment, net consisted of the following as of December 31: 2020 2019 Land and buildings $ 30,305 $ 29,153 Machinery and equipment 189,939 186,511 Construction in progress 1,558 12,961 Property, plant, and equipment, gross 221,802 228,625 Less accumulated depreciation ( 159,026 ) ( 154,939 ) Property, plant and equipment, net $ 62,776 $ 73,686 For financial reporting purposes, depreciation is computed using the straight-line method over the estimated useful lives (generally 15 to 40 years for buildings and building improvements, three to 20 years for machinery and equipment, three to seven years for tools and dies, and three to five years for computer hardware and software). Expenditures for maintenance and repairs are charged to expense as incurred. Expenditures for major betterments and renewals that extend the useful lives of property, plant and equipment are capitalized and depreciated over the remaining useful lives of the asset. When assets are retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations. Leasehold improvements are amortized using the straight-line method over the estimated useful lives of the improvements or the term of the lease, whichever is shorter. Accelerated depreciation methods are used for tax reporting purposes. Depreciation expense for property, plant and equipment for each of the years ended December 31, 2020, 2019 and 2018 was $ 15.1 million , $ 13.6 million and $ 14.0 million, respectively. We review long-lived assets for recoverability whenever events or changes in circumstances indicate that carrying amounts of an asset group may not be recoverable. Our asset groups are established by determining the lowest level of cash flows available. If the estimated undiscounted cash flows are less than the carrying amounts of such assets, we recognize an impairment loss in an amount necessary to write down the assets to fair value as estimated from expected future discounted cash flows. Estimating the fair value of these assets is judgmental in nature and involves the use of significant estimates and assumptions. We base our fair value estimates on assumptions we believe to be reasonable, but that are inherently uncertain. Leases - The Company adopted ASU No. 2016-02, Leases (“Topic 842”) as of January 1, 2019, using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of 2019. The cumulative effect of this transition was recorded as an increase to Accumulated deficit of $ 0.1 million as of this date. The Company determines if an arrangement is a lease at inception. Operating lease assets and liabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term. Lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. As most leases do not provide an implicit interest rate, we use our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The length of a lease term includes options to extend or terminate the lease when it is reasonably certain that the Company will exercise those options. The Company made an accounting policy election to not recognize lease assets or liabilities for leases with a term of 12 months or less. Additionally, when accounting for leases, the Company combines payments for leased assets, related services and other components of a lease. Goodwill - Assets and liabilities acquired in business combinations are accounted for using the acquisition method and recorded at their respective fair values. Goodwill represents the excess of consideration paid over the net assets acquired and is assigned to the reporting unit that acquires the business. A reporting unit is an operating segment as defined in ASC 280, Segment Reporting, or a business one level below an operating segment if discrete financial information for that business is prepared and regularly reviewed by segment management. The Company conducts annual impairment tests of goodwill in the second quarter or more frequently if events or circumstances indicate a reporting unit’s fair value may be less than its carrying value. If an initial assessment indicates it is more likely than not goodwill may be impaired, it is evaluated by comparing the reporting unit’s estimated fair value to its carrying value. If its carrying value exceeds its estimated fair value, goodwill impairment is 48 Table of Contents recognized to the extent that recorded goodwill exceeds the fair value of goodwill. Estimated fair values of the reporting unit are Level 3 measures and are developed under an income approach that discounts estimated future cash flows using risk-adjusted interest rates and also the market approach. Revenue Recognition - We recognize revenue when our performance obligation has been satisfied and control of products has been transferred to a customer, which typically occurs upon shipment. Revenue is measured based on the amount of consideration we expect to receive in exchange for the transfer of goods or services. Refer to Note 2, Revenue Recognition, for our revenue recognition policies. Income Taxes - We recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in our financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statements and tax basis of assets and liabilities based on enacted tax laws and rates expected to be in place when the deferred tax items are realized. In assessing the realizability of deferred tax assets, we consider whether it is more likely than not that a portion of the deferred tax assets will not be realized. We provide a valuation allowance for deferred tax assets when it is more likely than not that a portion of such deferred tax assets will not be realized. We evaluate tax positions for recognition by determining, based on the weight of available evidence, whether it is more likely than not the position will be sustained upon audit. Any interest and penalties related to our uncertain tax positions are recognized in income tax expense. Comprehensive Income (Loss) - Comprehensive income (loss) reflects the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources including foreign currency translation, derivative instruments and pension and other post-retirement adjustments. See Note 14, Accumulated Other Comprehensive Loss, for a rollforward of activity in accumulated comprehensive loss. Fair Value of Financial Instruments - The fair value framework requires the categorization of assets and liabilities into three levels based upon the assumptions (i.e., inputs) used to price the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3 generally requires significant management judgment. The three levels are defined as follows: Level 1 - Unadjusted quoted prices in active markets for identical assets and liabilities. Level 2 - Observable inputs other than those included in Level 1. For example, quoted prices for similar assets or liabilities in active markets and inactive markets. Level 3 - Significant unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the asset or liability. Concentrations of Credit Risk - Financial instruments that potentially subject us to concentrations of credit risk consist primarily of accounts receivable. We sell products to various companies throughout the world in the ordinary course of business. We routinely assess the financial strength of our customers and maintain allowances for anticipated losses. As of December 31, 2020, receivables from our five top customers represented approximately 48 % of total receivables. Foreign Currency Translation - Our functional currency is the local currency. Accordingly, all assets and liabilities of our foreign subsidiaries are translated using exchange rates in effect at the end of the period; revenue and costs are translated using average exchange rates for the period. The related translation adjustments are reported in accumulated other comprehensive income (loss) in stockholders’ equity. Translation gains and losses arising from transactions denominated in a currency other than the functional currency of the entity are included in the results of operations. Foreign Currency Forward Exchange Contracts - We use forward exchange contracts to hedge certain foreign currency transaction exposures. We estimate our projected revenues and purchases in certain foreign currencies or locations and hedge a portion of the anticipated long or short position. The contracts typically run from one month to eighteen months . All forward foreign exchange contracts that are not designated as hedging instruments have been marked-to-market and the fair value of contracts recorded in the Consolidated Balance Sheets with the offsetting non-cash gain or loss recorded in our Consolidated Statements of Operations. For forward contracts that are designated as hedging instruments, the gains and losses are recorded in accumulated other comprehensive income (loss) and recognized in the Consolidated Statement of Operations when the contracts are settled. We do not hold or issue foreign exchange options or forward contracts for trading purposes. Interest Rate Swap Agreement - We use an interest rate swap agreement to fix the interest rate on a portion of our variable interest debt thereby reducing exposure to interest rate changes. The interest rate swap agreement was not designated as a hedging instrument; therefore, the interest rate swap agreement has been marked-to-market and the fair value of the agreement recorded in the Consolidated Balance Sheets with the offsetting gain or loss recorded in interest and other expense in our Consolidated Statements of Operations. 49 Table of Contents Recently Issued Accounting Pronouncements In October 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020-10, "Codification Improvements". The ASU updates various codification topics by clarifying and improving disclosure requirements to align with the SEC's regulations. We will adopt ASU 2020-10 as of the reporting period beginning January 1, 2021. Adoption of this update is not expected to have a material impact on the Company's consolidated financial statements and related disclosures. In March 2020, the FASB issued ASU No. 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting". The ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. Also, in January 2021, the FASB issued ASU No. 2021-01 "Reference Rate Reform (Topic 848): Scope", to clarify that certain provisions in Topic 848, if elected by an entity, apply to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. ASU 2020-04 and ASU 2021-01 are effective beginning on March 12, 2020 and the amendments will be applied prospectively through December 31, 2022. We are evaluating the effect these ASUs will have on the Company. Accounting Pronouncements Implemented During the Year Ended December 31, 2020 In March 2020, the FASB issued ASU No. 2020-03, "Codification Improvements to Financial Instruments". The ASU clarifies disclosure guidance for fair value options, adds clarifications to the subsequent measurement of fair value, clarifies disclosure for depository and lending institutions, clarifies the line-of-credit or revolving-debt arrangements guidance, and the interaction of Financial Instruments - Credit Losses (Topic 326) with Leases (Topic 842) and Transfers and Servicing-Sales of Financial Assets (Subtopic 860-20). In accordance with ASU 2020-03, the Company adopted the guidance as of March 31, 2020. We were not materially impacted by the implementation of this pronouncement. In January 2017, the FASB issued ASU No. 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment". ASU 2017-04 provides simplification for the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. Annual impairment tests should be completed by comparing the fair value of a reporting unit to its carrying amount and impairment should not exceed the goodwill allocated to the reporting unit. Additionally, this ASU eliminated the requirement to assess reporting units with zero or negative carrying amounts. The Company implemented ASU 2017-04 as of January 1, 2020 with no material impact. Subsequent to such implementation, we fully impaired our goodwill. Refer to Note 4, Goodwill and Intangible Assets, for more details. In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments - Credit Losses (Topic 326)". The ASU requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. The FASB subsequently issued ASU No. 2018-19, "Codification Improvements to Topic 326: Financial Instruments - Credit Losses", in November 2018 which provided further guidance on assessment of receivables for operating leases. ASU No. 2019-04, "Codification Improvements to Topic 326, Topic 815 and Topic 825" and ASU No. 2019-05, "Targeted Transition Relief", that were issued in April and May of 2019 do not materially impact the Company. In November 2019, the FASB issued ASU No. 2019-11, "Codification Improvements to Topic 326, Financial Instruments - Credit Losses", which further clarified and improved the Codification to make it easier to understand and apply. The Company implemented ASU 2016-13, ASU 2018-19 and ASU 2019-11 as of January 1, 2020 and the ASUs did not have a material impact on the Company's consolidated financial statements. 2. Revenue Recognition Our products include electrical wire harnesses, control panels, electro-mechanical and cable assemblies; Trim; Seats; and cab structures and sleeper boxes; mirrors, wipers, controls and warehouse automation subsystems. We sell these products, except warehouse automation subsystems, into multiple geographic regions including North America, Europe and Asia-Pacific and to multiple customer end markets including MD/HD Truck OEMs, Construction OEMs, industrial, military, Bus OEMs, the aftermarket and other markets. We sell warehouse automation subsystems to warehouse automation customers. The nature, timing and uncertainty of recognition of revenue and associated cash flows across the varying product lines, geographic regions and customer end markets is substantially consistent. Contractual Arrangements - Revenue is measured based on terms and conditions specified in contracts or purchase orders with customers. We have long-term contracts with some customers that govern overall terms and conditions which are accompanied by purchase orders that define specific order quantities and/or price. We have many customers with which we conduct business for which the terms and conditions are outlined in purchase orders without a long-term contract. We generally do not have customer contracts with minimum order quantity requirements. 50 Table of Contents Amount and Timing of Revenue Recognition - The transaction price is based on the consideration to which the Company will be entitled in exchange for transferring control of a product to the customer. This is defined in a purchase order or in a separate pricing arrangement and represents the stand-alone selling price. Our payment terms vary by customer. None of the Company's business arrangements as of December 31, 2020, contained a significant financing component. We typically do not have multiple performance obligations requiring us to allocate a transaction price. We recognize revenue at the point in time when we satisfy a performance obligation by transferring control of a product to a customer, usually at a designated shipping point and in accordance with customer specifications. Estimates are made for variable consideration resulting from quality, delivery, discounts or other issues affecting the value of revenue and accounts receivable. This amount is estimated based on historical trends and current market conditions, and only amounts deemed collectible are recognized as revenues. Other Matters - Shipping and handling costs billed to customers are recorded in revenues and costs associated with outbound freight are generally accounted for as a fulfillment cost and are included in cost of revenues. We generally do not provide for extended warranties or material customer incentives. Our customers typically do not have a general right of return for our products. We had outstanding customer accounts receivable, net of allowances, of $ 151.1 million as of December 31, 2020 and $ 115.1 million as of December 31, 2019. We generally do not have other assets or liabilities associated with customer arrangements. Revenue Disaggregation - The following is the composition, by product category, of our revenues: Twelve Months Ended December 31, 2020 Electrical Systems Global Seating Corporate/ Other Total Seats $ 1,244 $ 261,942 $ ( 3,536 ) $ 259,650 Electrical wire harnesses, panels and assemblies 241,704 8,055 ( 129 ) 249,630 Trim 114,209 5,862 ( 1,636 ) 118,435 Cab structures and sleeper boxes 49,774 — — 49,774 Mirrors, wipers and controls 39,024 1,971 ( 785 ) 40,210 Total $ 445,955 $ 277,830 $ ( 6,086 ) $ 717,699 Twelve Months Ended December 31, 2019 Electrical Systems Global Seating Corporate/ Other Total Seats $ 1,447 $ 358,457 $ ( 3,027 ) $ 356,877 Electrical wire harnesses, panels and assemblies 196,280 2,360 ( 220 ) 198,420 Trim 190,877 18,714 ( 6,693 ) 202,898 Cab structures and sleeper boxes 87,864 — — 87,864 Mirrors, wipers and controls 54,433 2,017 ( 1,271 ) 55,179 Total $ 530,901 $ 381,548 $ ( 11,211 ) $ 901,238 Twelve Months Ended December 31, 2018 Electrical Systems Global Seating Corporate/ Other Total Seats $ 1,626 $ 373,322 $ ( 5,611 ) $ 369,337 Electrical wire harnesses, panels and assemblies 193,390 3,021 — 196,411 Trim 184,199 18,135 ( 6,907 ) 195,427 Cab structures and sleeper boxes 76,380 — — 76,380 Mirrors, wipers and controls 57,159 3,023 — 60,182 Total $ 512,754 $ 397,501 $ ( 12,518 ) $ 897,737 51 Table of Contents 3. Debt Debt consisted of the following at December 31: 2020 2019 Term loan and security agreement due 2023 $ 150,950 $ 159,912 Unamortized discount and issuance costs ( 4,374 ) ( 3,528 ) 146,576 156,384 Less: current portion, net of unamortized discount and issuance costs of $ 1.9 million and $ 1.1 million, respectively ( 2,429 ) ( 3,256 ) Total long-term debt, net of current portion $ 144,147 $ 153,128 Term Loan and Security Agreement On April 12, 2017, the Company entered into a $ 175.0 million senior secured term loan credit facility (the “Term Loan Facility”), maturing on April 12, 2023, pursuant to a term loan and security agreement (the “TLS Agreement”) with the Company and certain subsidiaries of the Company party thereto as guarantors, Bank of America, N.A., as administrative agent, and other lender parties thereto. The interest on the Term Loan Facility is variable and is comprised of 1) an applicable margin of either (i) 5.00 % for base rate loans or (ii) 6.00 % for LIBOR loans, in each case except for the period from April 1, 2020 through September 30, 2021, in which period such margin will be as amended by the Term Amendment, and 2) an applicable rate of either (i) base rate for any day (the “Base Rate”), a per annum rate equal to the greater of (a) the prime rate for such day, (b) the federal funds rate for such day, plus 0.50 %, or (c) LIBOR for a 30 day interest period as of such day, plus 1.00 %, or (ii) LIBOR as quoted two business days prior to the commencement of an interest period provided that LIBOR at no time falls below 1.00 %. There was $ 0.1 million in accrued interest as of December 31, 2020. The unamortized deferred financing fees of $ 3.1 million and original issue discount of $ 1.3 million are netted against the aggregate book value of the outstanding debt to arrive at a balance of $ 146.6 million as of December 31, 2020 and are being amortized over the remaining life of the agreement. The weighted average interest rate was 10.71 % as of December 31, 2020 and 8.29 % as of December 31, 2019. The Term Loan Facility is a senior secured obligation of the Company. Our obligations under the TLS Agreement are guaranteed by the Company and certain subsidiaries of the Company. The obligations of the Company and the guarantors under the TLS Agreement are secured (subject to certain permitted liens) by a first-priority lien on substantially all of the non-current assets (and a second priority lien on substantially all of the current assets) of the Company and the guarantors, including a first priority pledge of certain capital stock of the domestic and foreign subsidiaries directly owned by the Company and the guarantors. The liens, the security interests and all of the obligations of the Company and the guarantors and all provisions regarding remedies in an event of default are subject to an intercreditor agreement among the Company, the guarantors, the agent for the lenders party to the Company’s revolving credit facility and the collateral agent under the TLS Agreement. On May 11, 2020, the Company and certain of its subsidiaries, as guarantors or co-borrowers, as applicable, entered into an Amendment No. 1 (the “Term Amendment”), which amends TLS Agreement covenants. As amended, from April 1, 2020 through September 30, 2021, loans outstanding under the TLS Agreement accrue interest at a per annum rate based on (at the Company's election) the Base Rate plus 9.50 % or the LIBOR rate plus 10.50 %. The Company has the option of setting aside a portion of the interest accrual, not to exceed 4.5 %, as Payment In Kind and adding such amount to the outstanding principal balance in lieu of paying such interest amount in cash. Commencing October 1, 2021, loans under the TLS Agreement will accrue interest at a per annum rate based on (at the Company's election) the Base Rate plus 5.00 % or the LIBOR rate plus 6.00 %. Terms, Covenants and Compliance Status The TLS Agreement contains customary restrictive covenants, including limitations on our ability and the ability of our subsidiaries to: incur additional debt; pay dividends or other restricted payments; make investments; engage in transactions with affiliates; create liens on assets; and consolidate, merge or transfer all or substantially all of our assets and the assets of our subsidiaries. In addition, the TLS Agreement contains a financial maintenance covenant requiring the Company to maintain a total leverage ratio as of the last day of any fiscal quarter not to exceed the ratios set forth in the applicable table within the TLS Agreement. The TLS Agreement also contains customary reporting and other affirmative covenants. 52 Table of Contents The Term Amendment added a new minimum consolidated liquidity covenant of $ 40.0 million, to be tested each fiscal quarter through the fiscal quarter ending September 30, 2021, temporarily suspended the leverage ratio covenant through the fiscal quarter ending December 31, 2020, and reset the leverage ratio covenant levels for quarterly periods ended on or after March 31, 2021. In addition, amendments were made to certain restrictive covenants, the effect of which are to limit the Company's ability to incur additional debt, grant liens, repurchase the Company's stock and to issue dividends or make acquisitions. We were in compliance with the covenants as of December 31, 2020. The TLS Agreement requires the Company to repay principal of approximately $ 1.1 million on the last day of each quarter commencing with the quarter ending September 30, 2017 with the remaining outstanding principal due at maturity on April 12, 2023. The TLS Agreement, as amended, includes a hard call premium on repayments of the term loans outstanding thereunder of 2 % on amounts repaid through June 30, 2021 and 1 % on amounts repaid through June 30, 2022, subject to certain exceptions. The TLS Agreement requires the Company to make mandatory prepayments with excess cash flow, the proceeds of certain asset dispositions and upon the receipt of insurance or condemnation proceeds; and in the case of an asset disposition or insurance or condemnation event, to the extent the Company does not reinvest the proceeds within the periods set forth in the TLS Agreement. A mandatory prepayment of $ 4.2 million pursuant to the TLS Agreement was made during the first quarter of 2019 as a result of our 2018 Excess Cash Flow Period. Revolving Credit Facility On April 12, 2017, Commercial Vehicle Group Inc. and certain subsidiaries, collectively the "borrowers", entered into the Third Amended and Restated Loan and Security Agreement (the "Third ARLS Agreement") increasing its senior secured revolving credit facility (the "Revolving Credit Facility") to $ 65 million from $ 40 million and setting the maturity date to April 12, 2022. Up to an aggregate of $ 10 million is available to the borrowers for the issuance of letters of credit, which reduces availability under the Third ARLS Agreement. The Third ARLS Agreement included amendments to certain definitions and covenants including, but not limited to, amendments to (i) permitted debt, (ii) permitted distributions, (iii) distribution of assets, and (iv) the calculation of EBITDA. The Third ARLS Agreement contains a fixed charge coverage ratio maintenance covenant of 1.00 :1.00 and amended the availability threshold for triggering compliance with the fixed charge coverage ratio. The borrowers’ obligations under the Revolving Credit Facility are secured (subject to certain permitted liens) by a first-priority lien on substantially all of the current assets (and a second priority lien on substantially all of the non-current assets) of the borrowers. Each of the Company and each other borrower is jointly and severally liable for the obligations under the Revolving Credit Facility and unconditionally guarantees the prompt payment and performance thereof. The liens, the security interests and all of the obligations of the Company and each other borrower and all provisions regarding remedies in an event of default are subject to an intercreditor agreement among the Company, certain of its subsidiaries, the agent under the Third ARLS Agreement and the collateral agent for the lenders party to the Company’s Term Loan Facility. On September 18, 2019, the Company and certain of its subsidiaries, as co-borrowers, entered into an Amendment No. 1 (the “Amendment”), which amends the terms of the Revolving Credit Facility to entitle the Company and the other named borrowers thereunder (subject to the terms and conditions described therein) to request loans and other financial accommodations in an amount equal to the lesser of $ 90.0 million and a borrowing base composed of accounts receivable and inventory (such facility, the “Tranche A Facility”). Of the $ 90.0 million, $ 7.0 million shall be available as a first-in, last-out facility (“Tranche B Facility”) at a 100 basis points premium, as reflected in the below applicable margin table. On May 11, 2020, the Company and certain of its subsidiaries, as guarantors or co-borrowers, as applicable, entered into an Amendment No. 2 (the “Revolving Amendment”), which amends the terms of the Third ARLS Agreement to align certain of the restrictive covenants with the restrictive covenants set forth in the TLS Agreement, as amended. 53 Table of Contents As amended, loans outstanding under the Third ARLS Agreement accrue interest at a per annum rate based on (at the Company’s election) the base rate or the LIBOR rate plus a margin determined by reference to availability under the Revolving Credit Facility as follows, subject to a LIBOR floor of 1.00 %: Level Average Daily Availability Tranche A Base Rate Loans Tranche A LIBOR Revolver Loans Tranche B Base Rate Loans Tranche B LIBOR Revolver Loans III ≥ $ 30,000,000 1.00 % 2.00 % 2.00 % 3.00 % II > $ 15,000,000 but < $ 30,000,000 1.25 % 2.25 % 2.25 % 3.25 % I ≤ $ 15,000,000 1.50 % 2.50 % 2.50 % 3.50 % The applicable margin is subject to increase or decrease by the agent on the first day of the calendar month following each fiscal quarter end. If the agent is unable to calculate average daily availability for a fiscal quarter due to the borrowers' failure to deliver a borrowing base certificate when required, the applicable margin will be set at Level I until the first day of the calendar month following receipt of a borrowing base certificate. As of December 31, 2020, the applicable margin was set at Level III. The unamortized deferred financing fees associated with our revolving credit facility of $ 0.4 million and $ 0.6 million as of December 31, 2020 and December 31, 2019, respectively, are being amortized over the remaining life of the agreement. As of December 31, 2020 and December 31, 2019, we did no t have borrowings under the revolving credit facility and had outstanding letters of credit of $ 1.6 million , respectively. We had borrowing availability of $ 88.4 million at December 31, 2020. The Company pays a commitment fee to the lenders equal to 0.35 % per annum of the unused amounts under the revolving credit facility. Terms, Covenants and Compliance Status The Third ARLS Agreement requires the maintenance of a minimum fixed charge coverage ratio. The borrowers are not required to comply with the fixed charge coverage ratio requirement for so long as the borrowers maintain borrowing availability under the revolving credit facility at the greater of (i) $ 5,000,000 or (ii) ten percent ( 10 %) of the revolving commitments. If borrowing availability falls below this threshold at any time, the borrowers would be required to comply with the fixed charge coverage ratio of 1.00 :1.00 as of the end of each relevant fiscal quarter and would be required to continue to comply with these requirements until the borrowers have borrowing availability in excess of this threshold for 60 consecutive days. Since the Company had borrowing availability in excess of this threshold from December 31, 2019 through December 31, 2020, the Company was not required to comply with the minimum fixed charge coverage ratio covenant during the year ended December 31, 2020. The Third ARLS Agreement contains customary restrictive covenants, including limitations on our ability and the ability of our subsidiaries to: incur additional debt; pay dividends or other restricted payments; make investments; engage in transactions with affiliates; create liens on assets; and consolidate, merge or transfer all or substantially all of our assets and the assets of our subsidiaries. The Third ARLS Agreement also contains customary reporting and other affirmative covenants. The Company was in compliance with these covenants as of December 31, 2020. Voluntary prepayments of amounts outstanding under the Revolving Credit Facility are permitted at any time, without premium or penalty, other than (to the extent applicable) customary LIBOR breakage charges. The Third ARLS Agreement requires the borrowers to make mandatory prepayments upon the receipt of insurance or condemnation proceeds in respect of the revolving credit facility’s priority collateral. 54 Table of Contents 4. Goodwill and Intangible Assets Our intangible assets as of December 31 were comprised of the following: December 31, 2020 Weighted- Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Definite-lived intangible assets: Trademarks/tradenames 22 years $ 11,634 $ ( 4,681 ) $ 6,953 Customer relationships 15 years 14,881 ( 7,536 ) 7,345 Technical know-how 5 years 9,790 ( 2,529 ) 7,261 Covenant not to compete 5 years 330 ( 85 ) 245 $ 36,635 $ ( 14,831 ) $ 21,804 December 31, 2019 Weighted- Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Definite-lived intangible assets: Trademarks/tradenames 23 years $ 11,553 $ ( 4,276 ) $ 7,277 Customer relationships 15 years 15,025 ( 6,574 ) 8,451 Technical know-how 5 years $ 9,790 $ ( 571 ) 9,219 Covenant not to compete 5 years 330 ( 19 ) 311 $ 36,698 $ ( 11,440 ) $ 25,258 The aggregate intangible asset amortization expense was $ 3.4 million for the fiscal year ended December 31, 2020 and $ 2.0 million and $ 1.3 million for the fiscal years ended December 31, 2019 and 2018 respectively. The estimated intangible asset amortization expense for each of the five succeeding fiscal years ending after December 31, 2020 is $ 3.4 million for years 2021 through 2023, $ 2.8 million for the year ending December 31, 2024 and $ 1.4 million for the year ending December 31, 2025. Goodwill represents the excess of acquisition purchase price over the fair value of net assets acquired. During the first quarter of 2020, as a result of the Company’s market capitalization value being less than the carrying value of its equity for a duration of time, the Company determined it had an impairment indicator. Accordingly, the Company estimated the fair value of each of the reporting units with goodwill by discounting the estimated cash flows of each reporting unit. The estimated fair values of the reporting units were then compared to their net carrying values as of March 31, 2020 and, as a result, the Company recognized $ 27.1 million impairment of goodwill, which represented the carrying amount of goodwill prior to the impairment charge. The impairment charge is presented in Goodwill and other impairment expense in the Consolidated Statements of Operations. The changes in the carrying amounts of goodwill for the years ended December 31 are as follows: 2020 Electrical Systems Global Seating Total Balance - beginning of the year $ 22,802 $ 5,014 $ 27,816 Finalization of FSE purchase accounting ( 537 ) — ( 537 ) Goodwill impairment ( 22,265 ) ( 4,809 ) ( 27,074 ) Currency translation adjustment — ( 205 ) ( 205 ) Balance - end of the year $ — $ — $ — 2019 Electrical Systems Global Seating Total Balance - beginning of the year $ 2,437 $ 5,139 $ 7,576 Finalization of FSE purchase accounting 20,365 — 20,365 Currency translation adjustment — ( 125 ) ( 125 ) Balance - end of the year $ 22,802 $ 5,014 $ 27,816 55 Table of Contents 5. Business Combinations On September 17, 2019, the Company entered into and closed on an Asset Purchase Agreement (the “Agreement”) with First Source Electronics, LLC (“FSE”), Kevin Popielarczyk and Richard Vuoto and the Company’s wholly-owned subsidiary, CVG FSE, LLC (“CVG FSE”). The Agreement provided for the acquisition by CVG FSE of substantially all of the assets and certain liabilities of FSE in exchange for a cash purchase price of $ 34.0 million, subject to a net working capital adjustment, plus a right to earn up to $ 10.8 million in contingent milestone payments. The purchase was funded through domestic cash on hand and $ 2.0 million of borrowings under our revolving credit facility. FSE is in the business of manufacturing, distributing, marketing and selling cable and electro-mechanical assemblies, control panels and other business and consumer electronics products and services. FSE improves our ability to participate in the progression of digitalization, connectivity and associated power and data applications. Furthermore, this strategic acquisition complements our high-complexity, low-to-medium volume electrical business, provides an entry into the warehouse automation market, and provides the opportunity to leverage our global footprint and to increase cross-selling opportunities. The contingent milestone payments are payable based on achieving certain earnings before interest, taxes, depreciation and amortization ("EBITDA") thresholds over the periods from (a) September 18, 2019 through September 17, 2020, (b) September 18, 2019 through March 17, 2021, (c) September 18, 2019 through September 17, 2022 and (d) March 18, 2021 through September 17, 2022. The payment amount will be determined on a sliding scale for reaching between 90 % and 100 % of the respective EBITDA targets. The fair value for the milestone payments is based on a Monte Carlo simulation utilizing forecasted EBITDA through September 17, 2022 and a discount rate of 21.0 %. The estimate of $ 4.7 million was recorded within other long-term liabilities in the Consolidated Balance Sheet as of September 30, 2019. The total undiscounted contingent milestone payments is estimated at $ 10.8 million. The contingent consideration was revalued each quarter under the same valuation technique applied during purchase accounting. The fair value of contingent consideration increased during the year ended December 31, 2020 by $ 5.1 million, due to remeasurement which is recognized in Selling, general and administrative expenses in the Consolidated Statements of Operations. A payment of $ 1.0 million was made during the fourth quarter of 2020 based on achievement of the first EBITDA threshold. The fair value is $ 8.8 million as of December 31, 2020, based on a discount rate of 16.8 %. The Agreement contains customary indemnification provisions and provided for the establishment of an escrow fund of $ 3.0 million of the purchase price to secure indemnification claims by CVG FSE for an 18-month period. The Company is a party to the Agreement solely as a guarantor of CVG FSE’s payment obligations. The FSE Acquisition was accounted for under the acquisition method of accounting. Under acquisition accounting, the acquired tangible and intangible assets and liabilities of FSE have been recorded at their respective fair values. The Company has completed its assessment of fair values of assets acquired and liabilities assumed, and the final amounts are reflected in the table below. The purchase price associated with the FSE Acquisition exceeded the preliminary fair value of the net assets acquired by approximately $ 19.8 million. This reflects an increase of $ 2.2 million from the initial valuation as of December 31, 2019. A final adjustment to the purchase price was made in the three months ended March 31, 2020 reducing goodwill by $ 0.5 million. The excess purchase price over net assets acquired is recorded as goodwill and was determined as follows: Initial cash paid, net of working capital adjustment $ 34,000 Purchase price adjustment ( 537 ) Contingent consideration at fair value 4,700 Total consideration $ 38,163 Net assets at fair value 18,335 Excess of total consideration over net assets acquired $ 19,828 In the first quarter of 2020, pursuant to the asset purchase agreement a final adjustment resulted in a $ 0.5 million reduction in the initial consideration paid and goodwill. The valuation is final as of March 31, 2020. The allocation of the fair value of the 56 Table of Contents assets acquired and liabilities assumed, at acquisition and as adjusted for the final adjustment at December 31, 2020, were as follows: Preliminary Purchase Price Allocation Adjustment Final Purchase Price Allocation Net working capital $ 2,856 $ — $ 2,856 Property, plant and equipment 503 — 503 Other long-term assets 1,650 — 1,650 Definite-lived intangible assets 14,500 — 14,500 Goodwill 1 20,365 ( 537 ) 19,828 Other long-term liabilities ( 1,174 ) ( 1,174 ) Total consideration $ 38,700 $ ( 537 ) $ 38,163 1. As disclosed in Note 4, Goodwill and Intangible Assets, the full value of the Company's goodwill was impaired during the three months ended March 31, 2020. 6. Fair Value Measurement At December 31, 2020, our financial instruments included cash, accounts receivable, accounts payable, accrued liabilities and our revolving credit facility. The carrying value of these instruments approximates fair value as a result of the short duration of such instruments or due to the variability of the interest cost associated with such instruments. Foreign Currency Forward Exchange Contracts. Our derivative assets and liabilities represent foreign exchange contracts that are measured at fair value using observable market inputs such as forward rates, interest rates, our own credit risk and counterparty credit risk. Based on the utilization of these inputs, the derivative assets and liabilities are classified as Level 2. To manage our risk for transactions denominated in Mexican Pesos, we have entered into forward exchange contracts that are designated as cash flow hedge instruments, which are recorded in the Consolidated Balance Sheets at fair value. The gains and losses as a result of the changes in fair value of the hedge contract is deferred in accumulated other comprehensive loss and recognized in cost of revenues in the period the related hedge transactions are recognized. Interest Rate Swap Agreement. To manage our exposure to variable interest rates, we have entered into an agreement (the “Interest Rate Swap Agreement”) with Bank of America, N.A. whereby the Company has agreed to exchange, at a specified interval, the difference between fixed and variable interest amounts calculated by reference to an agreed upon notional principal amount. The Interest Rate Swap Agreement is intended to mitigate the impact of rising interest rates on the Company and covers $ 80 million of outstanding debt under the senior secured term loan facility. The Company expects this agreement to remain effective during the remaining term of the Interest Rate Swap Agreement and records the impact of the agreement in interest expense in the Consolidated Statements of Operations. The fair values of our derivative instruments and contingent consideration measured on a recurring basis as of December 31 and are categorized as follows: 2020 2019 Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Derivative assets Foreign exchange contract 1 $ 1,882 $ — $ 1,882 $ — $ 464 $ — $ 464 $ — Interest rate swap agreement 2 $ 936 $ — $ 936 $ — $ 150 $ — $ 150 $ — Derivative liabilities Interest rate swap agreement 3 $ 2,080 $ — $ 2,080 $ — $ 995 $ — $ 995 $ — Earnout liability Contingent consideration 4 $ 8,800 $ — $ — $ 8,800 $ 4,700 $ — $ — $ 4,700 Derivative equity Foreign exchange contract 5 $ 1,441 $ — $ 1,441 $ — $ 464 $ — $ 464 $ — 1 Presented in the Consolidated Balance Sheets in other current assets and based on observable market transactions of spot and forward rates. 2 Presented in the Consolidated Balance Sheets in accrued liabilities and based on observable market transactions of forward rates. 57 Table of Contents 3 Presented in the Consolidated Balance Sheets in accrued liabilities and other and based on observable market transactions of forward rates. 4 Presented in the Consolidated Balance Sheets in accrued liabilities and other long term liabilities and based on a Monte Carlo valuation model. 5 Presented in the Consolidated Balance Sheets in accumulated other comprehensive income (loss) and based on observable market transactions of forward rates. The following table summarizes the notional amount of our open foreign exchange contracts at December 31: 2020 2019 U.S. $ Equivalent U.S. $ Equivalent Fair Value U.S. $ Equivalent U.S. $ Equivalent Fair Value Commitments to buy or sell currencies $ 14,675 $ 16,558 $ 22,474 $ 22,939 We consider the impact of our credit risk on the fair value of the contracts, as well as the ability to execute obligations under the contract. The following table summarizes the effect of derivative instruments on the Consolidated Statements of Operations for derivatives not designated as hedging instruments at December 31: 2020 2019 Location of Gain (Loss) Recognized on Derivatives Amount of Gain (Loss) Recognized on Derivatives Foreign exchange contracts Cost of revenues $ ( 1,811 ) $ 4 Interest rate swap agreement Interest expense $ ( 1,031 ) $ ( 1,818 ) Long-term Debt . The fair value of long-term debt obligations is based on a fair value model utilizing observable inputs. Based on these inputs, our long-term debt is classified as Level 2. The carrying amounts and fair values of our long-term debt at December 31 are as follows: 2020 2019 Carrying Amount Fair Value Carrying Amount Fair Value Term loan and security agreement 1 $ 146,576 $ 144,878 $ 156,384 $ 157,983 1 Presented in the Consolidated Balance Sheets as the current portion of long-term debt of $ 2.4 million and long-term debt of $ 144.1 million as of December 31, 2020, and current portion of long-term debt of $ 3.3 million and long-term debt of $ 153.1 million as of December 31, 2019. Long-lived Assets. There are no fair value measurements of our long-lived assets and definite-lived intangible assets measured on a non-recurring basis, except for definite-lived intangibles acquired and contingent consideration as a part of the acquisition of First Source Electronics, LLC discussed in Note 5, Business Combination, as of December 31, 2020 and December 31, 2019. The contingent consideration is classified as Level 3 and valued based on a Monte Carlo valuation model. For the period ended December 31, 2020, an impairment charge of $ 1.1 million was recognized for the Electrical Systems segment, $ 0.4 million related to an operating lease right-of-use asset and $ 0.7 million related to property, plant and equipment. Additionally, for the period ended December 31, 2020, an impairment charge of $ 0.8 million was recognized for the corporate aircraft and was based on the selling price, less selling costs, of $ 0.3 million. These impairment charges are presented in impairment expense in the Consolidated Statements of Operations. Goodwill Impairment. For the period ended December 31, 2020, an impairment charge of $ 27.1 million was recognized for goodwill and was based on the estimated fair values of goodwill for the reporting units compared to the net carrying values at March 31, 2020. The impairment charge is presented in impairment expense in the Consolidated Statements of Operations. No other non-recurring fair value measurements were assessed during the period ended December 31, 2020 . 58 Table of Contents 7. Leases The Company leases office, warehouse and manufacturing space and certain equipment under non-cancelable operating lease agreements that generally require us to pay maintenance, insurance, taxes and other expenses in addition to annual rental fees. Our leases have remaining lease terms of one year to nine years , some of which include options to extend the leases for up to five years , and some of which include options to terminate the leases within one year . The components of lease expense are as follows: Twelve Months Ended December 31, 2020 2019 Operating lease cost 1 $ 11,214 $ 7,279 Finance lease cost: Amortization of right-of-use assets 394 341 Interest on lease liabilities 43 60 Total finance lease cost $ 437 $ 401 Short-term lease cost 2 4,258 7,357 Total lease expense $ 15,909 $ 15,037 1. The Company recognized accelerated lease costs of $ 1.1 million during the year ended December 31, 2020 related to the corporate research and development center. 2. Includes variable lease costs, which are not significant. Supplemental cash flow information related to leases is as follows: Twelve Months Ended December 31, 2020 Twelve Months Ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 10,571 $ 7,898 Financing cash flows from finance leases $ 446 $ 443 59 Table of Contents Supplemental balance sheet information related to leases is as follows: Balance Sheet Location December 31, 2020 December 31, 2019 Operating Leases Right-of-use assets, net Operating lease right-of-use assets, net $ 30,047 $ 34,960 Current liabilities Current operating lease liabilities $ 9,236 $ 7,620 Non-current liabilities Operating lease liabilities 23,932 29,414 Total operating lease liabilities $ 33,168 $ 37,034 Finance Leases 1 Right-of-use assets $ 1,410 $ 1,135 Accumulated depreciation ( 643 ) ( 343 ) Right-of-use assets, net Other assets, net $ 767 $ 792 Current liabilities Accrued liabilities and other $ 293 $ 354 Non-current liabilities Other long-term liabilities 434 398 Total finance lease liabilities $ 727 $ 752 Weighted Average Remaining Lease Term Operating leases 4.5 years 5.0 years Finance leases 3.2 years 2.8 years Weighted Average Discount Rate Operating leases 8.0 % 9.1 % Finance leases 5.1 % 7.2 % 1. Note that all new financing leases added during the twelve months ended December 31, 2020 were executed before the loan amendment discussed in Note 3, Debt, or May 11, 2020. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. We utilize an incremental borrowing rate, which is reflective of the specific term of the leases and economic environment of each geographic region, and apply a portfolio approach for certain machinery and equipment that have consistent terms in a specific geographic region. Anticipated future lease costs, which are based in part on certain assumptions to approximate minimum annual rental commitments under non-cancelable leases, are as follows: Year Ending December 31, Operating Financing Total 2021 $ 10,862 $ 320 $ 11,182 2022 9,583 200 9,783 2023 5,836 131 5,967 2024 4,585 80 4,665 2025 3,969 42 4,011 Thereafter 3,939 1 3,940 Total lease payments $ 38,774 $ 774 $ 39,548 Less: Imputed interest ( 5,606 ) ( 47 ) ( 5,653 ) Present value of lease liabilities $ 33,168 $ 727 $ 33,895 60 Table of Contents 8. Income Taxes Pre-tax income (loss) consisted of the following for the years ended December 31: 2020 2019 2018 Domestic $ ( 55,907 ) $ 4,777 $ 23,092 Foreign 11,407 16,779 26,484 Total $ ( 44,500 ) $ 21,556 $ 49,576 A reconciliation of income taxes computed at the statutory rates to the reported income tax provision for the years ended December 31 follows: 2020 2019 2018 Federal (benefit) provision at statutory rate $ ( 9,345 ) $ 4,527 $ 10,411 U.S./Foreign tax rate differential 492 393 731 Foreign non-deductible expenses 702 2,059 ( 1,759 ) Foreign tax provision 611 793 1,253 State taxes, net of federal benefit ( 1,086 ) 308 619 State tax rate change, net of federal benefit — ( 41 ) ( 32 ) Change in uncertain tax positions 71 15 84 Change in valuation allowance 2,146 ( 2,054 ) 597 Tax credits ( 143 ) ( 2,652 ) ( 2,049 ) Share-based compensation ( 15 ) ( 14 ) ( 50 ) Repatriation of foreign earnings 37 1,235 ( 3,670 ) GILTI, net of related foreign tax credit ( 1,340 ) 730 1,194 Other 419 479 758 (Benefit) Provision for income taxes $ ( 7,451 ) $ 5,778 $ 8,087 The provision (benefit) for income taxes for the years ended December 31 follows: 2020 2019 2018 Current Deferred Total Current Deferred Total Current Deferred Total Federal $ 109 $ ( 10,975 ) $ ( 10,866 ) $ ( 205 ) $ ( 336 ) $ ( 541 ) $ ( 3,432 ) $ 4,426 $ 994 State and local 120 ( 559 ) ( 439 ) 214 883 1,097 123 87 210 Foreign 4,449 ( 595 ) 3,854 4,207 1,015 5,222 6,365 518 6,883 Total $ 4,678 $ ( 12,129 ) $ ( 7,451 ) $ 4,216 $ 1,562 $ 5,778 $ 3,056 $ 5,031 $ 8,087 61 Table of Contents A summary of deferred income tax assets and liabilities as of December 31 follows: 2020 2019 Noncurrent deferred tax assets: Amortization and fixed assets $ 5,094 $ 830 Inventories 2,325 2,659 Pension obligations 2,827 2,134 Warranty obligations 473 741 Accrued benefits 551 369 Operating leases 664 165 Tax credit carryforwards 6,030 3,843 Net operating loss carryforwards 17,369 12,657 Other temporary differences not currently available for tax purposes 7,089 3,248 Total noncurrent deferred tax assets $ 42,422 $ 26,646 Valuation allowance ( 16,441 ) ( 11,992 ) Net noncurrent deferred tax assets $ 25,981 $ 14,654 Noncurrent deferred tax liabilities: Amortization and fixed assets $ ( 952 ) $ ( 2,501 ) Inventories 115 115 Pension obligations 161 — Accrued benefits ( 124 ) ( 111 ) Net operating loss carryforwards — 1,517 Other temporary differences not currently available for tax purposes ( 261 ) ( 578 ) Total noncurrent tax liabilities ( 1,061 ) ( 1,558 ) Total net deferred tax asset $ 24,920 $ 13,096 We assess whether valuation allowances should be established against deferred tax assets based on consideration of all available evidence using a “more likely than not” standard. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carryforward periods, our experience with unused tax attributes expiring and tax planning alternatives. In making such judgments, significant weight is given to evidence that can be objectively verified. During 2020, we recorded additional valuation allowance of $ 4.5 million on the deferred tax assets of our United Kingdom subsidiary and certain U.S. federal and state tax attribute carryforwards, and released $ 0.1 million in valuation allowances related to the deferred tax assets of our Luxembourg subsidiary. We expect to be able to realize the benefits of all of our deferred tax assets that are not currently offset by a valuation allowance, as discussed above. In the event that our actual results differ from our estimates or we adjust these estimates in future periods, the effects of these adjustments could materially impact our financial position and results of operations. Activity for the years ended December 31 is as follows (in thousands): 2020 2019 2018 Balance - Beginning of the year 11,992 $ 14,665 $ 15,021 Provisions 4,511 706 874 Utilizations ( 62 ) ( 3,379 ) ( 1,230 ) Balance - End of the year 16,441 $ 11,992 $ 14,665 As of December 31, 2020, the Company had net operating loss carryforwards of $ 126.5 million, of which $ 49.1 million related to foreign jurisdictions and $ 77.4 million related to U.S. state jurisdictions. The carryforward periods for these net operating losses range from five years to indefinite. Utilization of these losses is subject to the tax laws of the applicable tax jurisdiction and may be limited by the ability of certain subsidiaries to generate taxable income in the associated tax jurisdiction. We have established valuation allowances for all net operating losses that we believe are more likely than not to expire before they can be utilized. 62 Table of Contents As of December 31, 2020, we had $ 3.3 million of U.S. foreign tax credit carryforwards, net of a $ 1.7 million valuation allowance, primarily attributable to the deemed repatriation of the accumulated untaxed earnings of our foreign subsidiaries resulting from the U.S. Tax Reform. Utilization of these credits may be limited if the Company does not generate sufficient U.S. federal taxable income in future years. The credits begin to expire in 2027. As of December 31, 2020, we had $ 0.9 million of research and development tax credit carryforwards related to our U.S. operations. Utilization of these credits may be limited if the Company does not generate sufficient U.S. federal taxable income in future years. The credits begin to expire in 2032. As of December 31, 2020, cash of $ 41.9 million was held by foreign subsidiaries. During the year ended December 31, 2020, $ 11.2 million, net of $ 0.6 million in foreign withholding tax incurred, was repatriated from the Company's foreign subsidiaries. The Company had a $ 0.3 million deferred tax liability as of December 31, 2020 for the expected future income tax implications of repatriating cash from the foreign subsidiaries for which no indefinite reinvestment assertion has been made. We file federal income tax returns in the U.S. and income tax returns in various states and foreign jurisdictions. In the U.S., we are generally no longer subject to tax assessment for tax years prior to 2017. In our major non-U.S. jurisdictions including China, Czech Republic, Mexico and the United Kingdom, tax years are typically subject to examination for three to five years. As of December 31, 2020, and 2019, we provided a liability of $ 1.0 million and $ 0.9 million, respectively, for unrecognized tax benefits associated with our U.S. federal and state, and foreign jurisdictions. The majority of these unrecognized tax benefits are netted against their related non-current deferred tax assets. We accrue interest and penalties related to unrecognized tax benefits through income tax expense. We had $ 0.5 million and $ 0.4 million accrued for the payment of interest and penalties as of December 31, 2020 and December 31, 2019, respectively. Accrued interest and penalties are included in the $ 1.0 million of unrecognized tax benefits. A reconciliation of the beginning and ending amount of unrecognized tax benefits (including interest and penalties) at December 31 follows: 2020 2019 2018 Balance - Beginning of the year $ 908 $ 894 $ 811 Gross increase - tax positions in prior periods 73 70 66 Gross decreases - tax positions in prior periods — ( 39 ) ( 14 ) Gross increases - current period tax positions — — 59 Lapse of statute of limitations — ( 12 ) ( 12 ) Currency translation adjustment 25 ( 5 ) ( 16 ) Balance - End of the year $ 1,006 $ 908 $ 894 9. Accrued and Other Liabilities Accrued and other liabilities consisted of the following as of December 31: 2020 2019 Compensation and benefits $ 13,172 $ 9,111 Contingent consideration 4,870 570 Taxes payable 4,057 2,513 Insurance 2,705 3,110 Accrued freight 2,556 2,408 Warranty costs 2,041 3,082 Legal and professional fees 2,008 2,115 Deferred tooling revenue 1,371 524 Accrued services 1,250 912 Restructuring 679 2,324 Other 6,111 6,004 $ 40,820 $ 32,673 63 Table of Contents 10. Defined Contribution Plan, Pension and Other Post-Retirement Benefit Plans Defined Contribution Plan - We sponsor a defined contribution plan covering eligible employees. Eligible employees can contribute on a pre-tax basis to the plan. In accordance with the terms of the 401(k) plan, we elect to match a certain percentage of the participants’ contributions to the plan, as defined. We recognized expense associated with the plan of $ 1.9 million, $ 4.6 million and $ 3.6 million for the years ended December 31, 2020, 2019, and 2018, respectively. The decrease in expense for the year ended December 31, 2020 as compared to the to the prior year period primarily resulted from the temporary suspension of the employer 401(k) match taken in response to the COVID-19 pandemic. Pension and Other Post-Retirement Benefit Plans - We sponsor pension and other post-retirement benefit plans that cover certain hourly and salaried employees in the U.S. and United Kingdom. Each of the plans are frozen to new participants and to additional service credits earned. In December 2018, we consolidated the U.S. plans. Our policy is to make annual contributions to the plans to fund the minimum contributions, as required by local regulations. During the three months ended March 31, 2019, the Company offered employees with deferred vested balances in the U.S. defined benefit pension plan the opportunity to voluntarily elect an early payout of their benefits. Payouts totaling $ 7.9 million were made during 2019 and were paid out of plan assets resulting in a non-cash settlement charge of $ 2.5 million, which was recorded in interest and other expense in the Consolidated Statements of Operations and is reflected in amortization of prior service cost in the net periodic (benefit) cost table below. The change in benefit obligation, plan assets and funded status as of December 31 is as follows: U.S. Pension and Other Post-Retirement Benefit Plans Non-U.S. Pension Plan 2020 2019 2020 2019 Change in benefit obligation: Benefit obligation — Beginning of the year $ 39,577 $ 45,238 $ 44,841 $ 40,265 Service cost — — 37 — Interest cost 1,117 1,483 838 1,112 Participant contributions 2 6 — — Benefits paid ( 2,344 ) ( 10,346 ) ( 1,820 ) ( 1,681 ) Actuarial loss 2,866 3,196 7,514 3,730 Exchange rate changes — — 2,244 1,415 Benefit obligation at end of the year 41,218 39,577 53,654 44,841 Change in plan assets: Fair value of plan assets — Beginning of the year 40,045 42,962 34,321 30,424 Actual return on plan assets 4,907 6,588 3,474 3,610 Employer contributions 18 835 948 887 Participant contributions 2 6 — — Benefits paid ( 2,344 ) ( 10,346 ) ( 1,820 ) ( 1,681 ) Exchange rate changes — — 1,562 1,081 Fair value of plan assets at end of the year 42,628 40,045 38,485 34,321 Funded status $ 1,410 $ 468 $ ( 15,169 ) $ ( 10,520 ) Actuarial Loss - The projected U.S. benefit obligation includes a net loss of $ 2.9 million for the year ended December 31, 2020. The loss is a result of changes in key actuarial assumptions, including the decrease in the discount rate. The projected Non-U.S. benefit obligation includes a net loss of $ 7.5 million for the year ended December 31, 2020 driven primarily by a decrease in the discount rate assumption. 64 Table of Contents Amounts recognized in the Consolidated Balance Sheets at December 31 consisted of: U.S. Pension and Other Post-Retirement Benefit Plans Non-U.S. Pension Plan 2020 2019 2020 2019 Noncurrent assets $ 1,557 $ 633 $ — $ — Current liabilities ( 20 ) ( 19 ) — — Noncurrent liabilities ( 127 ) ( 146 ) ( 15,169 ) ( 10,520 ) Amount recognized $ 1,410 $ 468 $ ( 15,169 ) $ ( 10,520 ) The components of net periodic (benefit) cost for the years ended December 31 were as follows: U.S. Pension and Other Post-Retirement Benefit Plans Non-U.S. Pension Plan 2020 2019 2018 2020 2019 2018 Interest cost $ 1,117 $ 1,483 $ 1,664 $ 838 $ 1,112 $ 1,030 Expected return on plan assets ( 2,075 ) ( 2,393 ) ( 3,151 ) ( 1,093 ) ( 1,117 ) ( 1,210 ) Amortization of prior service cost 1 6 2,528 6 47 47 — Recognized actuarial loss 283 308 263 592 531 496 Net periodic cost (benefit) $ ( 669 ) $ 1,926 $ ( 1,218 ) $ 384 $ 573 $ 316 1 Includes $ 2.5 million non-cash settlement charge arising from the early payout of the U.S. defined benefit plan benefits in the year ended December 31, 2019. Net periodic (benefit) cost components, not inclusive of service costs, are recognized in Other (expense) income within the Consolidated Statements of Operations. Amounts Recognized in Accumulated Other Comprehensive Income (Loss) - Amounts recognized in Accumulated other comprehensive income (loss), before taking into account income tax effects, at December 31 are as follows: U.S. Pension and Other Post-Retirement Benefit Plans Non-U.S. Pension Plan 2020 2019 2018 2020 2019 2018 Net actuarial loss $ 10,689 $ 10,937 $ 14,767 $ 18,574 $ 13,783 $ 12,972 Prior service cost 39 45 51 748 747 788 $ 10,728 $ 10,982 $ 14,818 $ 19,322 $ 14,530 $ 13,760 Other Changes in Plan Assets and Benefit Obligations Recognized in Comprehensive Income (Loss) - Amounts recognized as other changes in plan assets and benefit obligations in comprehensive income (loss), before taking into account income tax effects, for the year ended December 31 are as follows: U.S. Pension and Other Post-Retirement Plans Non-U.S. Pension Plan 2020 2019 2020 2019 Actuarial (gain) loss $ 34 $ ( 1,001 ) $ 5,428 $ 968 Amortization of actuarial (loss) gain ( 283 ) ( 2,829 ) ( 625 ) ( 37 ) Prior service credit ( 6 ) ( 6 ) ( 11 ) ( 416 ) Total recognized in other comprehensive income (loss) $ ( 255 ) $ ( 3,836 ) $ 4,792 $ 515 Weighted-average assumptions used to determine benefit obligations at December 31 were as follows: U.S. Pension and Other Post-Retirement Benefit Plans Non-U.S. Pension Plan 2020 2019 2020 2019 Discount rate 2.08 % 2.93 % 1.20 % 1.95 % 65 Table of Contents Weighted-average assumptions used to determine net periodic benefit cost at December 31 were as follows: U.S. Pension and Other Post-Retirement Plans Non-U.S. Pension Plan 2020 2019 2018 2020 2019 2018 Discount rate 2.93 % 3.40 % 3.42 % 1.95 % 2.80 % 2.45 % Expected return on plan assets 5.34 % 5.34 % 7.00 % 3.30 % 3.70 % 3.70 % The rate of return assumptions are based on projected long-term market returns for the various asset classes in which the plans are invested, weighted by the target asset allocations. An incremental amount for active plan asset management and diversification, where appropriate, is included in the rate of return assumption. Our pension plan investment strategy is reviewed periodically, but no less frequently than annually. We employ a total return investment approach whereby a mix of equities, fixed income and real estate investments are intended to maximize the long-term return of plan assets taking into consideration a prudent level of risk. The intent of this strategy is to minimize plan expenses by outperforming plan liabilities over the long run. Risk tolerance is established through consideration of plan liabilities, plan funded status and corporate financial condition. The investment portfolio contains a diversified blend of equity, balanced, fixed income and real estate investments. Furthermore, equity investments are diversified across U.S. and non-U.S. stocks, as well as growth, value and large and small capitalizations. Other assets, such as real estate, are used judiciously to perhaps enhance long-term returns and to improve portfolio diversification. Derivatives may be used to gain market exposure in an efficient and timely manner; however, derivatives may not be used to leverage the portfolio beyond the market value of the underlying investments. Investment risk is measured and monitored on an ongoing basis in light of annual liability measurements, periodic asset/liability studies and quarterly investment portfolio reviews. We expect to contribute approximately $ 1.1 million to our pension plans and our other post-retirement benefit plans in 2021. Our investment allocation target for our pension plans for 2020 and our weighted-average asset allocations of our pension assets for the years ended December 31, by asset category, are as follows: Target Allocation Actual Allocations as of December 31, 2020 2019 2020 2019 U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S. Cash and cash equivalents 1 — — — 1 5 — 1 Equity/Balanced securities 29 52 27 55 29 49 28 53 Fixed income securities 61 48 63 45 61 46 62 46 Real estate 9 — 10 — 9 — 10 — 100 % 100 % 100 % 100 % 100 % 100 % 100 % 100 % Our plan assets can be described as follows: Equity Securities - Includes common stocks issued by U.S., United Kingdom and other international companies, equity funds that invest in common stocks and unit linked insurance policies. Equity investments generally allow near-term (within 90 days of the measurement date) liquidity and are held in issues that are actively traded to facilitate transactions at minimum cost. Balanced Securities - Includes funds primarily invested in a mix of equity and fixed income securities where the allocations are at the discretion of the investment manager. Investments generally allow near-term (within 90 days of the measurement date) liquidity and are held in issues that are actively traded to facilitate transactions at minimum cost. Fixed Income Securities - Includes U.S. dollar-denominated and United Kingdom and other international marketable bonds and convertible debt securities as well as fixed income funds that invest in these instruments. Investments generally allow near-term liquidity and are held in issues that are actively traded to facilitate transactions at minimum cost. The fair value of fixed income securities is determined by either direct or indirect quoted market prices. When the value of assets held in separate accounts is not published, the value is based on the underlying holdings, which are primarily direct quoted market prices on regulated financial exchanges. Real Estate - Real estate provides an indirect investment into a diversified and multi-sector portfolio of property assets. The fair value of real estate investments is determined by the fund managers. The fund managers value the real estate investments via independent third-party appraisals on a periodic basis. Assumptions used to revalue the properties are updated every quarter. 66 Table of Contents The fair values of our pension plan assets by asset category and by level as described in Note 6, Fair Value Measurement, for the years ended December 31, 2020 and for the year ended December 31, 2019 are as follows: December 31, 2020 Quoted Prices in Active Markets for Identical Assets Significant Observable Inputs Significant Unobservable Inputs Total Level 1 Level 2 Level 3 Cash and cash equivalents $ 2,125 $ 2,125 $ — $ — Equities: U.S. large value 2,525 2,525 — — U.S. large growth 2,741 2,741 — — International blend 5,253 — 5,253 — Emerging markets 1,717 1,717 — — Balanced 18,958 — 18,958 — Fixed income securities: Corporate bonds 40,485 — 40,485 — Other 3,221 — 3,221 — Real Estate: U.S. property 4,088 — — 4,088 Total pension fund assets $ 81,113 $ 9,108 $ 67,917 $ 4,088 December 31, 2019 Quoted Prices in Active Markets for Identical Assets Significant Observable Inputs Significant Unobservable Inputs Total Level 1 Level 2 Level 3 Cash and cash equivalents $ 332 $ 332 $ — $ — Equities: U.S. large value 2,434 2,434 — — U.S. large growth 2,059 2,059 — — International blend 4,854 — 4,854 — Emerging markets 1,603 1,603 — — Balanced 18,246 — 18,246 — Fixed income securities: Government bonds 24,917 — 24,917 — Corporate bonds 12,634 — 12,634 — Other 3,217 — 3,217 — Real Estate: U.S. property 4,070 — — 4,070 Total pension fund assets $ 74,366 $ 6,428 $ 63,868 $ 4,070 The fair value of our pension plan assets measured using significant unobservable inputs (Level 3) at December 31 are as follows: 2020 2019 Beginning balance $ 4,070 $ 10,962 Actual return on assets held at reporting date 18 430 Purchases, sales and settlements, net — ( 7,322 ) Ending balance $ 4,088 $ 4,070 67 Table of Contents The following table summarizes our expected future benefit payments of our pension and other post-retirement benefit plans: Year Ending December 31, Pension Plans 2021 $ 4,392 2022 $ 4,361 2023 $ 4,466 2024 $ 4,501 2025 $ 4,415 2025 to 2029 $ 22,290 11. Performance Awards In 2020, the Company made awards, defined as cash, shares or other awards, to employees under the Commercial Vehicle Group, Inc. 2014 Equity Incentive Plan (the “2014 EIP”) and the Commercial Vehicle Group, Inc. 2020 Equity Incentive Plan (the “2020 EIP”). Effective June 15, 2020, as part of the Company’s stockholders’ approval of the 2020 EIP, the Company agreed that no more awards will be made under the 2014 Plan. The cash award is earned and payable based upon the Company’s relative total shareholder return in terms of ranking as compared to the peer group over a three-year period (the “Performance Period”). Total shareholder return is determined by the percentage change in value (positive or negative) over the applicable measurement period as measured by dividing (A) the sum of the cumulative value of dividends and other distributions paid on the Common Stock for the applicable measurement period and the difference (positive or negative) between each such company’s starting stock price and ending stock price, by (B) the starting stock price. The award is payable at the end of the Performance Period in cash if the employee is employed through the end of the Performance Period. If the employee is not employed during the entire Performance Period, the award is forfeited. These grants are accounted for as cash settlement awards for which the fair value of the award fluctuates based on the change in total shareholder return in relation to the peer group. The following table summarizes performance awards granted in the form of cash awards under the equity incentive plans: Amount Adjusted Award Value at December 31, 2019 $ 2,726 New grants 2,108 Forfeitures ( 2,704 ) Adjustments ( 854 ) Payments ( 300 ) Adjusted Award Value at December 31, 2020 $ 976 The Company generally grants performance awards in the first quarter of each year. Unrecognized compensation expense was $ 1.7 million and $ 1.1 million as of December 31, 2020 and 2019, respectively. 12. Share-Based Compensation The compensation expense for our share-based compensation arrangements (see Restricted Stock Awards below) was $ 3.5 million, $ 2.8 million and $ 3.1 million for the years ended December 31, 2020, 2019 and 2018, respectively. Share-based compensation expense is included in selling, general and administrative expenses in the Consolidated Statements of Operations. Restricted Stock Awards - Restricted stock is a grant of shares of common stock that may not be sold, encumbered or disposed of and that may be forfeited in the event of certain terminations of employment or in the case of the board of directors, a separation for cause, prior to the end of a restricted period set by the compensation committee of the board of directors. Forfeitures are recorded as they occur. A participant granted restricted stock generally has all of the rights of a stockholder, unless the compensation committee determines otherwise. As of December 31, 2020, there was approximately $ 4.3 million of unrecognized compensation expense related to non-vested share-based compensation arrangements granted under our equity incentive plans. This expense is subject to future adjustments and forfeitures and will be recognized on a straight-line basis over the remaining period listed above for each grant. 68 Table of Contents A summary of the status of our restricted stock awards as of December 31, 2020 and changes during the twelve-month period ending December 31, 2020, is presented below: 2020 Shares (000’s) Weighted- Average Grant-Date Fair Value Non-vested - beginning of year 403 $ 7.72 Granted 1,708 $ 3.25 Vested ( 545 ) $ 5.33 Forfeited ( 303 ) $ 4.54 Non-vested - end of year 1,263 $ 3.48 As of December 31, 2020, a total of 2.9 million shares were available for future grants from the shares authorized for award under our 2020 EIP, including cumulative forfeitures. We have elected to report forfeitures as they occur as opposed to estimating future forfeitures in our share-based compensation expense. Repurchase of Common Stock - We did not repurchase any of our common stock on the open market as part of a stock repurchase program during 2020; however, our employees surrendered 96 thousand shares of our common stock to satisfy tax withholding obligations on the vesting of the restricted stock awards. 13. Stockholders’ Equity Common Stock - Our authorized capital stock includes common stock of 60,000,000 shares with a par value of $ 0.01 per share, with 31,249,811 and 30,801,255 shares outstanding as of December 31, 2020 and 2019, respectively. Preferred Stock - Our authorized capital stock includes preferred stock of 5,000,000 shares with a par value of $ 0.01 per share, with no shares outstanding as of December 31, 2020 and 2019. Earnings (Loss) Per Share - Basic earnings (loss) per share is determined by dividing net income by the weighted average number of common shares outstanding during the year. Diluted earnings (loss) per share presented is determined by dividing net income by the weighted average number of common shares and potential common shares outstanding during the period as determined by the treasury stock method. Potential common shares are included in the diluted earnings per share calculation when dilutive. Diluted earnings (loss) per share for years ended December 31, 2020, 2019 and 2018 includes the effects of potential common shares when dilutive and is as follows: 2020 2019 2018 Net income (loss) attributable to common stockholders $ ( 37,049 ) $ 15,778 $ 41,489 Weighted average number of common shares outstanding 30,943 30,602 30,277 Dilutive effect of restricted stock grants after application of the treasury stock method — 221 310 Dilutive shares outstanding 30,943 30,823 30,587 Basic earnings (loss) per share attributable to common stockholders $ ( 1.20 ) $ 0.52 $ 1.37 Diluted earnings (loss) per share attributable to common stockholders $ ( 1.20 ) $ 0.51 $ 1.36 For the year ended December 31, 2020, diluted earnings (loss) per share excludes 220 thousand shares, of non-vested restricted stock as the effect would have been anti-dilutive. There were no anti-dilutive shares for the year ended December 31, 2019. Dividends — We have not declared or paid any cash dividends in the past. The terms of the Third ARLS Agreement and the Term Loan Facility restrict the payment or distribution of our cash or other assets, including cash dividend payments. Shareholder Rights Plan On June 23, 2020, the Company’s Board of Directors adopted a limited duration rights plan and declared a dividend distribution of one right (each, a “Right” and together with all other such rights distributed or issued pursuant thereto, the “Rights”) for each outstanding share of common stock, par value $ 0.01 , of the Company, as of July 5, 2020, the record date for such dividend. 69 Table of Contents Each holder of common stock as of the record date will receive a dividend of one Right per share of common stock. The Rights will become exercisable only if a person or persons acquires beneficial ownership of 10 % or more of the Company's outstanding common stock, or 15 % in the case of certain passive investors. In the event that the Rights become exercisable, each holder of Rights (other than the person or group triggering the rights plan) will be entitled to purchase, at the Right’s exercise price, a number of shares of our common stock having a market value of twice the Right’s exercise price. The rights plan will expire on June 24, 2021 unless earlier terminated or amended by our Board of Directors. 14. Accumulated Other Comprehensive Loss The activity for each item of accumulated other comprehensive loss is as follows: Foreign currency items Derivative Instruments Pension and Other Post-Retirement Benefit Plans Accumulated other comprehensive loss Balance - December 31, 2018 $ ( 22,847 ) $ 496 $ ( 25,120 ) $ ( 47,471 ) Net current period change ( 1,185 ) — 2,415 1,230 Derivative instruments — ( 32 ) — ( 32 ) Reclassification adjustments for losses reclassified into income — — 323 323 Balance - December 31, 2019 $ ( 24,032 ) $ 464 $ ( 22,382 ) $ ( 45,950 ) Net current period change $ 5,008 $ — $ ( 4,597 ) $ 411 Derivative instruments — 977 — 977 Reclassification adjustments for losses reclassified into income — — ( 444 ) ( 444 ) Balance - December 31, 2020 $ ( 19,024 ) $ 1,441 $ ( 27,423 ) $ ( 45,006 ) The related tax effects allocated to each component of other comprehensive (loss) income for the years ended December 31, 2020 and 2019 are as follows: 2020 Before Tax Amount Tax Expense After Tax Amount Retirement benefits adjustment: Net actuarial loss and prior service credit $ ( 4,537 ) $ ( 60 ) $ ( 4,597 ) Reclassification of actuarial loss and prior service cost to net income ( 505 ) 61 ( 444 ) Net unrealized loss ( 5,042 ) 1 ( 5,041 ) Cumulative translation adjustment 5,008 — 5,008 Derivative instruments 1,419 ( 442 ) 977 Total other comprehensive gain $ 1,385 $ ( 441 ) $ 944 2019 Before Tax Amount Tax Expense After Tax Amount Retirement benefits adjustment: Net actuarial gain and prior service credit $ 3,320 $ ( 905 ) $ 2,415 Reclassification of actuarial loss and prior service cost to net income 323 — 323 Net unrealized gain 3,643 ( 905 ) 2,738 Cumulative translation adjustment ( 1,185 ) — ( 1,185 ) Derivative instruments ( 32 ) — ( 32 ) Total other comprehensive gain $ 2,426 $ ( 905 ) $ 1,521 70 Table of Contents 15. Cost Reduction and Manufacturing Capacity Rationalization During 2019, the Company began implementing cost reduction and manufacturing capacity rationalization initiatives (the "Restructuring Initiatives") in response to declines in end market volumes. Furthermore, in 2020 the Company began implementing additional cost reduction initiatives and further manufacturing capacity rationalization initiatives in response to the COVID-19 pandemic ("the 2020 Initiatives"). These actions were substantially complete as of December 31, 2020. The Restructuring Initiatives and 2020 Initiatives consist primarily of headcount reductions in each segment and at corporate, as well as other costs associated with transfer of production and subsequent closure of facilities, and expansion of production footprint to manufacture warehouse automation subsystems. The changes in accrued restructuring balances are as follows: Electrical Systems Global Seating Corporate/ Other Total Balance - December 31, 2018 $ — $ — $ — $ — New charges 2,159 489 310 2,958 Payments and other adjustments ( 883 ) ( 387 ) 636 ( 634 ) Balance - December 31, 2019 $ 1,276 $ 102 $ 946 $ 2,324 New charges 4,149 1,126 1,639 6,914 Payments and other adjustments ( 4,962 ) ( 1,188 ) ( 2,409 ) ( 8,559 ) Balance - December 31, 2020 $ 463 $ 40 $ 176 $ 679 Of the $ 6.9 million costs incurred in the twelve months ended December 31, 2020, $ 3.5 million primarily related to headcount reductions and $ 3.4 million related to facility exit and other costs. Of the $ 6.9 million costs incurred, $ 4.7 million was recorded in cost of revenues and $ 2.2 million was recorded in selling, general and administrative expenses. Of the $ 3.0 million costs incurred in the twelve months ended December 31, 2019, $ 2.6 million primarily related to headcount reductions and $ 0.4 million related to facility exit and other costs. Of the $ 3.0 million costs incurred, $ 2.2 million was recorded in cost of revenues and $ 0.8 million was recorded in selling, general and administrative expenses. 16. Commitments and Contingencies Leases - As disclosed in Note 7, Leases, we lease office, warehouse and manufacturing space and equipment under non-cancelable operating lease agreements that generally require us to pay maintenance, insurance, taxes and other expenses in addition to annual rental fees. As of December 31, 2020, our equipment leases did not provide for any material guarantee of a specified portion of residual values. Guarantees - Costs associated with guarantees are accrued when it is probable that a liability has been incurred and the amount can be reasonably estimated. The most likely cost to be incurred is accrued based on an evaluation of available facts; where no amount within a range of estimates is more likely, the minimum is accrued. As of December 31, 2020 and 2019, we had no such guarantees. Litigation - We are subject to various legal proceedings and claims arising in the ordinary course of business, including but not limited to workers' compensation claims, OSHA investigations, employment disputes, unfair labor practice charges, customer and supplier disputes, service provider disputes, product liability claims, intellectual property disputes, environmental claims arising out of the conduct of our businesses and examinations by the Internal Revenue Service. Management believes that the Company maintains adequate insurance and that we have established reserves for issues that are probable and estimable in amounts that are adequate to cover reasonable adverse judgments not covered by insurance. Based upon the information available to management and discussions with legal counsel, it is the opinion of management that the ultimate outcome of the various legal actions and claims that are incidental to our business are not expected to have a material adverse impact on the consolidated financial position, results of operations, equity or cash flows; however, such matters are subject to many uncertainties and the outcomes of individual matters are not predictable with any degree of assurance. Warranty - We are subject to warranty claims for products that fail to perform as expected due to design or manufacturing deficiencies. Depending on the terms under which we supply products to our customers, a customer may hold us responsible for some or all of the repair or replacement costs of defective products when the product supplied did not perform as represented. Our policy is to record provisions for estimated future customer warranty costs based on historical trends and for specific 71 Table of Contents claims. These amounts, as they relate to the years ended December 31, 2020 and 2019, are included within accrued liabilities and other in the accompanying Consolidated Balance Sheets. The following presents a summary of the warranty provision for the years ended December 31: 2020 2019 Balance - beginning of the year $ 3,082 $ 3,911 Provision for warranty claims 656 1,868 Deduction for payments made and other adjustments ( 1,697 ) ( 2,697 ) Balance - end of year $ 2,041 $ 3,082 Debt Payments - As disclosed in Note 3, Debt, the TLS Agreement requires the Company to repay a fixed amount of principal on a quarterly basis, make mandatory prepayments of excess cash flows and voluntary prepayments that coincide with certain events. The following table provides future minimum principal payments and mandatory prepayment of excess cash flows due on long-term debt for the next five years. The existing long-term debt agreement matures in 2023; no payments are due thereafter: Year Ending December 31, 2021 $ 4,375 2022 4,375 2023 142,200 2024 — 2025 — Thereafter — 17. Segment Reporting Operating segments are defined as components of an enterprise that are evaluated regularly by the Company’s chief operating decision maker (“CODM”), which is our President and Chief Executive Officer. Each of these segments consists of a number of manufacturing facilities. Certain of our facilities manufacture and sell products through both of our segments. Each manufacturing facility that sells products through both segments is reflected in the financial results of the segment that has the greatest amount of revenues from that manufacturing facility. Our segments are more specifically described below. The Electrical Systems segment designs, manufactures and sells the following products: • Electrical sytstems, electrical wire harnesses, electro-mechanical assemblies for warehouses, electro-mechanical cable assemblies for the construction, agricultural, industrial, automotive, truck, mining, rail and military industries in North America, Europe and Asia-Pacific. This segment includes a portion of the company’s activities in the emerging electric vehicle market; • Plastic components ("Trim") primarily for the North America commercial vehicle market and recreational vehicle markets; • Warehouse automation subsystems primarily for the North American e-commerce markets and include electro-mechanical assemblies and panels; • Commercial vehicle accessories including wipers, mirrors, floormats and sensors; and • Cab structures for the North American MD/HD truck market. The Global Seating segment designs, manufactures and sells the following products: • Commercial vehicle seats for the global commercial vehicle markets including heavy duty trucks, medium duty trucks, last mile trucks, construction equipment, material handling equipment and agriculture equipment in North America, Europe and Asia-Pacific. This segment includes a portion of the company’s activities in the emerging electric vehicle market; • Office seats primarily in Europe and Asia-Pacific; and • Aftermarket seats and components in North America, Europe and Asia-Pacific. 72 Table of Contents Corporate expenses consist of certain overhead and shared costs that are not directly attributable to the operations of a segment. For purposes of business segment performance measurement, some of these costs that are for the benefit of the operations are allocated based on a combination of methodologies. The costs that are not allocated to a segment are considered stewardship costs and remain at corporate in our segment reporting. The following table presents segment revenues, gross profit, selling, general and administrative expenses, amortization expense, operating income, capital expenditures, depreciation expense and other items for the year ended December 31, 2020. The table does not include assets as the CODM does not review assets by segment. For the year ended December 31, 2020 Electrical Systems Global Seating Corporate/ Other Total Revenues External revenues $ 443,363 $ 274,336 $ — $ 717,699 Intersegment revenues 2,592 3,494 ( 6,086 ) — Total revenues $ 445,955 $ 277,830 $ ( 6,086 ) $ 717,699 Gross profit $ 42,811 $ 31,635 $ ( 370 ) $ 74,076 Selling, general & administrative expenses 19,811 18,355 26,628 64,794 Amortization expense 2,917 517 — 3,434 Goodwill and other impairment 23,415 4,809 793 29,017 Operating income (loss) $ ( 3,332 ) $ 7,954 $ ( 27,791 ) $ ( 23,169 ) Capital expenditures and depreciation expense: Capital expenditures $ 4,617 $ 1,485 $ 1,040 $ 7,142 Depreciation expense $ 8,760 $ 4,287 $ 2,012 $ 15,059 The following table presents segment revenues, gross profit, selling, general and administrative expenses, amortization expense, operating income, capital expenditures and depreciation expense for the year ended December 31, 2019. The table does not include assets as the CODM does not review assets by segment. For the year ended December 31, 2019 Electrical Systems Global Seating Corporate/Other Total Revenues External revenues $ 522,484 $ 378,754 $ — $ 901,238 Intersegment revenues 8,417 2,794 ( 11,211 ) — Total revenues $ 530,901 $ 381,548 $ ( 11,211 ) $ 901,238 Gross profit $ 60,008 $ 45,201 $ ( 72 ) $ 105,137 Selling, general & administrative expenses 15,815 20,429 26,305 62,549 Amortization expense 1,415 537 — 1,952 Operating income (loss) $ 42,778 $ 24,235 $ ( 26,377 ) $ 40,636 Capital expenditures and depreciation expense: Capital expenditures $ 17,728 $ 3,721 $ 2,668 $ 24,117 Depreciation expense $ 6,699 $ 4,379 $ 2,484 $ 13,562 73 Table of Contents The following table presents segment revenues, gross profit, selling, general and administrative expenses, amortization expense, operating income, capital expenditures, depreciation expense and other items as of and for the year ended December 31, 2018. The table does not include assets as the CODM does not review assets by segment. For the year ended December 31, 2018 Electrical Systems Global Seating Corporate/Other Total Revenues External revenues $ 503,717 $ 394,020 $ — $ 897,737 Intersegment revenues 9,037 3,481 ( 12,518 ) — Total revenues $ 512,754 $ 397,501 $ ( 12,518 ) $ 897,737 Gross profit $ 71,104 $ 54,231 $ ( 415 ) $ 124,920 Selling, general & administrative expenses 15,390 22,433 22,856 60,679 Amortization expense 747 553 — 1,300 Operating income (loss) $ 54,967 $ 31,245 $ ( 23,271 ) $ 62,941 Capital expenditures and depreciation expense: Capital expenditures $ 9,825 $ 3,579 $ 2,140 $ 15,544 Depreciation expense $ 6,919 $ 4,604 $ 2,448 $ 13,971 The following table presents revenues and long-lived assets for the geographic areas in which we operate: Years Ended December 31, 2020 2019 2018 Revenues Long-lived Assets Revenues Long-lived Assets Revenues Long-lived Assets United States $ 536,846 $ 60,605 $ 691,224 $ 70,870 $ 670,075 $ 49,874 United Kingdom 33,329 10,763 48,070 12,233 51,451 3,204 All other countries 147,524 22,222 161,944 26,335 176,211 11,023 $ 717,699 $ 93,590 $ 901,238 $ 109,438 $ 897,737 $ 64,101 Sales to A.B. Volvo and Daimler, which are included in both reporting segments, have been in excess of 10% of total Company revenues in each of the years ended December 31, 2020, 2019 and 2018. No other customers exceed 10% of the Company’s revenues in any period presented. The following table presents revenue from the above mentioned customers as a percentage of total revenue: Years Ended December 31, 2020 2019 2018 A.B. Volvo 16 % 22 % 19 % Daimler 14 % 17 % 16 % 74 18. Quarterly Financial Data (Unaudited) The following is a condensed summary of quarterly results of operations for 2020 and 2019: Revenues Gross Profit Operating Income Net Income (Loss) Basic Earnings (Loss) Per Share 1 Dilutive Earnings (Loss) Per Share 1 2020: First $ 187,105 20,303 ( 26,523 ) $ ( 24,594 ) $ ( 0.80 ) $ ( 0.80 ) Second $ 126,896 6,475 ( 10,515 ) $ ( 12,497 ) $ ( 0.40 ) $ ( 0.40 ) Third $ 187,697 24,159 8,893 $ 4,178 $ 0.13 $ 0.13 Fourth $ 216,001 $ 23,139 $ 4,976 $ ( 4,136 ) $ ( 0.13 ) $ ( 0.13 ) 2019: First $ 243,164 $ 33,089 $ 17,569 $ 9,986 $ 0.33 $ 0.33 Second $ 243,190 $ 32,436 $ 15,866 $ 6,146 $ 0.20 $ 0.20 Third $ 225,399 $ 29,444 $ 11,476 $ 7,180 $ 0.23 $ 0.23 Fourth $ 189,485 $ 10,168 $ ( 4,275 ) $ ( 7,534 ) $ ( 0.24 ) $ ( 0.24 ) 1. The sum of earnings per share for the quarters may not equal earnings per share for the total year due to changes in the average number of ordinary shares outstanding. 19. Subsequent Event On March 1, 2021, Commercial Vehicle Group, Inc. (the “Company”) and certain of its subsidiaries entered into Amendment No. 3 (the “Revolving Amendment”) to the Third Amended and Restated Loan and Security Agreement (as amended prior to the Revolving Amendment, the “Revolving Loan Agreement”) originally dated as of April 12, 2017, with Bank of America, N.A., as agent, and certain financial institutions as lenders (the “Lenders”), which Revolving Loan Agreement governs the Company’s asset-based revolving credit facility (the “Revolving Credit Facility”). The Revolving Amendment amends the terms of the Revolving Loan Agreement, among other things, to extend the maturity date of the Revolving Credit Facility to March 1, 2026 and to remove the condition that the first $ 7.0 million of the $ 90.0 million Revolver Commitments are available as a first-in, last-out facility. The Revolving Loan Agreement, as amended, also allows the Company to increase the size of the Revolving Credit Facility by up to $ 50.0 million with the consent of Lenders providing the increase in the Revolving Credit Facility. The Revolving Loan Agreement, provides that loans outstanding under the Revolving Credit Facility accrue interest at a per annum rate based on (at the Company’s election) the base rate or the LIBOR rate plus a margin determined by reference to availability under the Revolving Credit Facility as follows, subject to a LIBOR floor of 0.25 %: Level Average Daily Availability Base Rate Loans LIBOR Loans III ≥ $ 30,000,000 0.50 % 1.50 % II > $ 15,000,000 but < $ 30,000,000 0.75 % 1.75 % I ≤ $ 15,000,000 1.00 % 2.00 % The Revolving Loan Agreement, provides for an unused line fee of 0.20 % on undrawn amounts under the Revolving Credit Facility if Revolver Usage is equal to or greater than 50% of the Revolver Commitment and a fee of 0.25 % if Revolver Usage is less than 50% of the Revolver Commitment. The Revolving Loan Agreement, requires maintenance of a minimum fixed charge coverage ratio if availability under the Revolving Credit Facility is less than the greater of (i) $ 5.0 million, and (ii) 10 % of the lesser of the Revolver Commitment and 75 Table of Contents the Borrowing Base. The minimum fixed charge coverage ratio must be maintained until availability under the Revolving Credit Facility has been greater than or equal to the greater of (i) $ 5.0 million, and (ii) 10 % of the lesser of the Revolver Commitment and the Borrowing Base for 60 consecutive days. 76 Table of Contents Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure There were no disagreements with our independent accountants on matters of accounting and financial disclosures or reportable events.