ICHOR HOLDINGS, LTD. 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures We carried out an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer (the certifying officers), of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a‑15(e) and 15d‑15(e) under the Securities and Exchange Act, as amended (“the Exchange Act”)) as of December 31, 2021. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as a result of the material weaknesses in internal control over financial reporting as described below, our disclosure controls and procedures were not effective as of December 31, 2021. Management’s Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a‑15(f) and 15d‑15(f) under the Exchange Act). With the participation of our Chief Executive Officer and Chief Financial Officer, our management, under the oversight of our Board of Directors, evaluated the effectiveness of our internal control over financial reporting as of December 31, 2021 using the framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control—Integrated Framework (2013). We completed our acquisition of IMG Companies, LLC, and its subsidiaries (“IMG”) on November 19, 2021. We are continuing to integrate IMG into our internal control over financial reporting, and management’s evaluation of the effectiveness of our internal control over financial reporting excluded IMG. IMG had total assets of approximately $293.0 million as of December 31, 2021, and included in the results of our operations for 2021 are net sales of $7.3 million from IMG. Based on that evaluation, management concluded that our internal control over financial reporting was not effective as of December 31, 2021 due to the material weaknesses in internal control over financial reporting, described below. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. The identified material weaknesses related to ineffective information technology general controls (“ITGCs”) in the areas of user access and program change management over certain information technology systems (“IT”) systems that support our financial reporting processes. The control deficiencies were a result of: inadequate design of IT control processes that were lacking sufficient documentation such that successful operation of the ITGC’s were overly dependent upon knowledge and actions of certain individuals with IT expertise; insufficient training of IT personnel on the requirements to maintain evidence of ITGC control processes and procedures; and risk-assessment processes inadequate to identify and assess changes in IT environments that could impact internal control over financial reporting. Our automated and manual business process controls that are dependent on the affected ITGCs were also deemed ineffective because they could have been adversely impacted. The material weaknesses did not result in any identified misstatements to the financial statements, and there were no changes to previously released financial results. Our independent registered public accounting firm, KPMG LLP, who audited the consolidated financial statements included in this Annual Report on Form 10‑K, issued an adverse opinion on the effectiveness of the Company’s internal control over financial reporting. KPMG LLP’s report appears on page F‑3 of this Annual Report on Form 10-K. Remediation Management is taking steps to remediate the ITGC deficiencies and will continue to take measures designed to ensure that control deficiencies contributing to the material weaknesses are remediated, such that these controls are designed, implemented, and operating effectively. The remediation actions include: • designing and fully documenting ITGC processes and procedures specifically over user access and change management; 41 • developing a training program addressing ITGCs, including educating control owners concerning the principles and requirements of each control, with a focus on maintaining evidence for user access and change-management over IT systems impacting financial reporting; • developing an IT compliance function that’s responsible for the development, training, and testing of the global ITGCs; and • developing enhanced risk assessment procedures and controls related to changes in IT environments. The material weaknesses will not be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that the control objective is achieved and the controls are operating effectively. We expect that the remediation of these material weaknesses will be completed prior to the end of fiscal year 2022. Changes in Internal Control Over Financial Reporting Other than the material weaknesses identified during the quarter, there have been no other changes in our internal control over financial reporting (as defined in Rules 13a‑15(f) or 15d‑15(f) of the Exchange Act) that occurred during the fourth quarter of December 31, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Inherent Limitations on Effectiveness of Controls and Procedures A company’s internal control over financial reporting is a process designed by, or under the supervision of, a company’s principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate. If we cannot provide reliable financial information, our business, operating results and share price could be negatively impacted. ITEM 9B. OTHER INFORMATION None. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS None. 42 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE The information required by this item is incorporated by reference to our Proxy Statement for our 2022 General Meeting to be filed with the SEC within 120 days after the close of the year ended December 31, 2021. Code of Conduct We have adopted a code of business ethics and conduct (the “Code of Conduct”) that applies to all employees, officers, and directors, including the principal executive officer, principal financial officer, and principal accounting officer. The Code of Conduct is available on our investor relations website at ir.ichorsystems.com . We intend to post all disclosures that are required by law or NASDAQ listing rules regarding any amendment to, or a waiver of, any provision of the Code of Conduct for the principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. ITEM 11. EXECUTIVE COMPENSATION The information required by this item is incorporated by reference to our Proxy Statement for our 2022 General Meeting to be filed with the SEC within 120 days after the close of the year ended December 31, 2021. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS The information required by this item is incorporated by reference to our Proxy Statement for our 2022 General Meeting to be filed with the SEC within 120 days after the close of the year ended December 31, 2021. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE The information required by this item is incorporated by reference to our Proxy Statement for our 2022 General Meeting to be filed with the SEC within 120 days after the close of the year ended December 31, 2021. ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES The information required by this item is incorporated by reference to our Proxy Statement for our 2022 General Meeting to be filed with the SEC within 120 days after the close of the year ended December 31, 2021. PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a) The following documents are filed as a part of this report: (1) Financial Statements. The following Consolidated Financial Statements are filed as part of this report under Item 8 – Financial Statements and Supplementary Data . Reports of Independent Registered Public Accounting Firm ( KPMG LLP , Portland, Oregon , PCAOB ID: 185 ) F‑1 Consolidated Balance Sheets F‑5 Consolidated Statements of Operations F‑6 Consolidated Statements of Shareholders’ Equity F‑7 Consolidated Statements of Cash Flows F‑8 Notes to Consolidated Financial Statements F‑9 (2) Exhibits. Exhibits are listed on the Exhibit Index at the end of this report. ITEM 16. FORM 10-K SUMMARY Not applicable. 43 Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors Ichor Holdings, Ltd.: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Ichor Holdings, Ltd. and subsidiaries (the Company) as of December 31, 2021 and December 25, 2020, the related consolidated statements of operations, shareholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2021, and the related notes (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, 2021 and December 25, 2020, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2021, 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, 2021, 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 February 28, 2022 expressed an adverse opinion on the effectiveness of the Company’s internal control over financial reporting. 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. Evaluation of excess and obsolete inventory As discussed in Notes 1 and 3 to the consolidated financial statements, the Company reported net inventories of $236.1 million as of December 31, 2021, including an adjustment for excess and obsolete inventory of $14.1 million. The Company states its inventories at the lower of cost or net realizable value. The Company records an adjustment to the cost basis of inventory when evidence exists that the net realizable value of inventory is lower than its cost, which occurs when the Company has excess and/or obsolete inventory. The Company’s model to estimate excess and/or obsolete inventory is based on an analysis of existing inventory quantities on-hand compared to estimated future consumption. Future consumption is estimated based upon assumptions about how historical consumption, recent purchases, backlog and other factors indicate future consumption. We identified the evaluation of excess and obsolete inventory as a critical audit matter. There was subjective auditor judgement in evaluating whether historical consumption and recent purchases reasonably indicate future consumption used by the Company in their determination that inventory is recorded at the lower of its cost or net realizable value. F-1 The following are the primary procedures we performed to address the critical audit matter. We evaluated the assumptions used to estimate future consumption by (1) examining historical write-down trends and (2) inspecting publicly available industry information to assess relevant changes to the overall business environment. Additionally, to evaluate whether recent purchases and historical consumption indicates future consumption we selected a sample of products within inventory and for each sample selection we calculated the rate of consumption for current quantity on hand based on (i) historical consumption and (ii) backlog. Fair value of certain acquired customer relationship intangible assets As discussed in Note 2 to the consolidated financial statements, on November 19, 2021, the Company acquired IMG Companies, LLC (IMG) and accounted for the transaction as a business combination. As a result of the transaction, the Company recorded intangible assets of $62.4 million for customer relationships associated with the generation of future income from IMG’s existing customers. The estimated fair value of the customer relationship intangible assets was determined using a discounted cash flow model. We identified the evaluation of the fair value of certain customer relationships acquired in the IMG transaction as a critical audit matter due to the high degree of subjectivity in evaluating discounted future cash flows used to determine the fair value. Specifically, there was a high degree of auditor judgment required to evaluate the forecasted revenue attributable to customer relationships as changes in this assumption could have a significant impact on the fair value of the customer relationships. The following are the primary procedures we performed to address the critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s acquisition-date valuation process including controls over the development of forecasted revenue attributable to customer relationships. We evaluated the forecasted revenue assumptions attributable to customer relationships by comparing these assumptions to IMG’s historical results, industry publications, as well as the revenue growth rates of guideline peer companies. In addition, we involved valuation professionals with specialized skills and knowledge who assisted in evaluating the relevance of the guideline peer companies based on financial and non-financial metrics. /s/ KPMG LLP We have served as the Company’s auditor since 2011. Portland, Oregon February 28, 2022 F-2 Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors Ichor Holdings, Ltd.: Opinion on Internal Control Over Financial Reporting We have audited Ichor Holdings, Ltd. and subsidiaries' (the Company) internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, because of the effect of the material weaknesses, described below, on the achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2021 and December 25, 2020, the related consolidated statements of operations, shareholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2021, and the related notes (collectively, the consolidated financial statements), and our report dated February 28, 2022 expressed an unqualified opinion on those consolidated financial statements. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. The material weaknesses relate to ineffective information technology general controls (ITGCs) in the areas of user access and program change-management over certain information technology systems that support the Company’s financial reporting processes which have been identified and included in management’s assessment. The material weaknesses were considered in determining the nature, timing, and extent of audit tests applied in our audit of the 2021 consolidated financial statements, and this report does not affect our report on those consolidated financial statements. The Company acquired IMG Companies, LLC during 2021, and management excluded from its assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2021, IMG Companies, LLC’s internal control over financial reporting associated with total assets of $293 million and total revenues of $7.3 million included in the consolidated financial statements of the Company as of and for the year ended December 31, 2021. Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of IMG Companies, LLC. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. 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 audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. F-3 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ KPMG LLP Portland, Oregon February 28, 2022 F-4 ICHOR HOLDINGS, LTD. Consolidated Balance Sheets (dollars in thousands, except per share data) December 31, 2021 December 25, 2020 Assets Current assets: Cash and cash equivalents $ 75,495 $ 252,899 Accounts receivable, net 142,990 100,977 Inventories 236,133 134,756 Prepaid expenses and other current assets 8,153 7,082 Total current assets 462,771 495,714 Property and equipment, net 85,204 41,811 Operating lease right-of-use assets 29,790 10,088 Other noncurrent assets 9,166 5,503 Deferred tax assets, net 8,116 6,324 Intangible assets, net 89,927 39,845 Goodwill 335,902 174,887 Total assets $ 1,020,876 $ 774,172 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable $ 159,727 $ 116,664 Accrued liabilities 19,066 20,792 Other current liabilities 14,377 10,700 Current portion of long-term debt 7,500 8,750 Current portion of lease liabilities 7,633 5,128 Total current liabilities 208,303 162,034 Long-term debt, less current portion, net 285,253 191,522 Lease liabilities, less current portion 22,354 5,272 Deferred tax liabilities, net 38 109 Other non-current liabilities 4,213 3,546 Total liabilities 520,161 362,483 Shareholders’ equity: Preferred shares ($ 0.0001 par value; 20,000,000 shares authorized; zero shares issued and outstanding) — — Ordinary shares ($ 0.0001 par value; 200,000,000 shares authorized; 28,551,160 and 27,907,077 shares outstanding, respectively; 32,988,599 and 32,344,516 shares issued, respectively) 3 3 Additional paid in capital 417,438 399,311 Treasury shares at cost ( 4,437,439 shares) ( 91,578 ) ( 91,578 ) Retained earnings 174,852 103,953 Total shareholders’ equity 500,715 411,689 Total liabilities and shareholders’ equity $ 1,020,876 $ 774,172 See accompanying notes to consolidated financial statements. F-5 ICHOR HOLDINGS, LTD. Consolidated Statements of Operations (dollars in thousands, except per share data) Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Net sales $ 1,096,917 $ 914,236 $ 620,837 Cost of sales 919,437 789,344 534,473 Gross profit 177,480 124,892 86,364 Operating expenses: Research and development 15,691 13,361 11,102 Selling, general, and administrative 65,857 56,614 47,270 Amortization of intangible assets 14,918 13,365 13,015 Total operating expenses 96,466 83,340 71,387 Operating income 81,014 41,552 14,977 Interest expense, net 6,451 8,727 10,647 Other expense, net 807 534 55 Income before income taxes 73,756 32,291 4,275 Income tax expense (benefit) 2,857 ( 988 ) ( 6,454 ) Net income $ 70,899 $ 33,279 $ 10,729 Net income per share: Basic $ 2.51 $ 1.44 $ 0.48 Diluted $ 2.45 $ 1.42 $ 0.47 Shares used to compute net income per share: Basic 28,259,607 23,172,961 22,418,802 Diluted 28,979,352 23,460,105 22,766,903 See accompanying notes to consolidated financial statements. F-6 ICHOR HOLDINGS, LTD. Consolidated Statements of Shareholders’ Equity (dollars in thousands) Additional Total Ordinary Shares Paid-In Treasury Shares Retained Shareholders' Shares Amount Capital Shares Amount Earnings Equity Balance at December 28, 2018 22,234,508 $ 2 $ 228,358 4,339,529 $ ( 89,979 ) $ 59,945 $ 198,326 Ordinary shares issued from exercise of stock options 353,027 — 5,042 — — — 5,042 Ordinary shares issued from vesting of restricted share units 81,438 — ( 290 ) — — — ( 290 ) Ordinary shares issued from employee share purchase plan 47,645 — 671 — — — 671 Repurchase of ordinary shares ( 97,910 ) — — 97,910 ( 1,599 ) — ( 1,599 ) Share-based compensation expense — — 8,537 — — — 8,537 Net income — — — — — 10,729 10,729 Balance at December 27, 2019 22,618,708 2 242,318 4,437,439 ( 91,578 ) 70,674 221,416 Ordinary shares issued, net of transaction costs 4,600,000 1 139,371 — — — 139,372 Ordinary shares issued from exercise of stock options 514,481 — 8,849 — — — 8,849 Ordinary shares issued from vesting of restricted share units 140,700 — ( 1,829 ) — — — ( 1,829 ) Ordinary shares issued from employee share purchase plan 33,188 — 727 — — — 727 Share-based compensation expense — — 9,875 — — — 9,875 Net income — — — — — 33,279 33,279 Balance at December 25, 2020 27,907,077 3 399,311 4,437,439 ( 91,578 ) 103,953 411,689 Ordinary shares issued from exercise of stock options 410,558 — 8,288 — — — 8,288 Ordinary shares issued from vesting of restricted share units 164,613 — ( 3,616 ) — — — ( 3,616 ) Ordinary shares issued from employee share purchase plan 68,912 — 1,982 — — — 1,982 Share-based compensation expense — — 11,473 — — — 11,473 Net income — — — — — 70,899 70,899 Balance at December 31, 2021 28,551,160 $ 3 $ 417,438 4,437,439 $ ( 91,578 ) $ 174,852 $ 500,715 See accompanying notes to consolidated financial statements. F-7 ICHOR HOLDINGS, LTD. Consolidated Statements of Cash Flows (in thousands) Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Cash flows from operating activities: Net income $ 70,899 $ 33,279 $ 10,729 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation and amortization 25,992 24,246 21,869 Share-based compensation 11,473 9,875 8,537 Deferred income taxes ( 1,863 ) ( 1,687 ) ( 7,131 ) Amortization of debt issuance costs 883 968 937 Gain on sale of asset disposal group ( 504 ) 3,575 — Loss on extinguishment of debt 737 — — Other 484 — — Changes in operating assets and liabilities, net of acquisitions: Accounts receivable, net ( 33,454 ) ( 16,128 ) ( 44,562 ) Inventories ( 89,249 ) ( 8,527 ) ( 5,931 ) Prepaid expenses and other assets 786 ( 2,076 ) 6,067 Accounts payable 38,649 ( 14,509 ) 67,966 Accrued liabilities ( 6,740 ) 7,722 3,214 Other liabilities ( 2,821 ) 1,521 ( 4,545 ) Net cash provided by operating activities 15,272 38,259 57,150 Cash flows from investing activities: Capital expenditures ( 20,839 ) ( 10,301 ) ( 12,343 ) Cash paid for acquisitions, net of cash acquired ( 268,766 ) ( 5,035 ) — Cash paid for intangible assets — — ( 8,147 ) Purchase of marketable securities ( 115,197 ) — — Proceeds from maturities and sales of marketable securities 114,713 — — Proceeds from sale of property and equipment 504 739 — Net cash used in investing activities ( 289,585 ) ( 14,597 ) ( 20,490 ) Cash flows from financing activities: Issuance of ordinary shares, net of fees — 139,372 — Issuance of ordinary shares under share-based compensation plans 9,664 9,832 5,757 Employees' taxes paid upon vesting of restricted share units ( 3,616 ) ( 1,829 ) ( 290 ) Repurchase of ordinary shares — — ( 1,599 ) Debt issuance and modification costs ( 1,852 ) — — Borrowings on revolving credit facility 137,591 30,000 13,000 Repayments on revolving credit facility ( 41,753 ) — ( 28,000 ) Proceeds from term loan 94,175 — Repayments on term loan ( 97,300 ) ( 8,750 ) ( 8,750 ) Net cash provided by (used in) financing activities 96,909 168,625 ( 19,882 ) Net increase (decrease) in cash ( 177,404 ) 192,287 16,778 Cash at beginning of period 252,899 60,612 43,834 Cash at end of period $ 75,495 $ 252,899 $ 60,612 Supplemental disclosures of cash flow information: Cash paid during the period for interest $ 7,123 $ 8,235 $ 8,424 Cash paid during the period for taxes, net of refunds $ 5,642 $ 250 $ 896 Supplemental disclosures of non-cash activities: Capital expenditures included in accounts payable $ 930 $ 369 $ 774 Right-of-use assets obtained in exchange for new operating lease liabilities, including those acquired through acquisitions $ 24,643 $ 642 $ 817 See accompanying notes to consolidated financial statements. F-8 ICHOR HOLDINGS, LTD. Notes to Financial Statements (dollar figures in tables in thousands, except per share data) Note 1 – Organization and Summary of Significant Accounting Policies Organization and Operations of the Company Ichor Holdings, Ltd. and Subsidiaries (the “we”, “us”, “our”, “Company”) designs, develops, manufactures, and distributes gas and liquid delivery subsystems and components purchased by capital equipment manufacturers for use in the semiconductor markets. We are headquartered in Fremont, California and have operations in the United States, the United Kingdom, Singapore, Malaysia, Korea, and Mexico. On December 30, 2011, Ichor Systems Holdings, LLC consummated a sales transaction with Icicle Acquisition Holdings, LLC, a Delaware limited liability company. Shortly after consummation of the sale transaction, Icicle Acquisition Holdings, LLC changed its name to Ichor Holdings, LLC. In March 2012, Ichor Holdings, LLC completed a reorganization of its legal structure, forming Ichor Holdings, Ltd., a Cayman Islands entity. Ichor Holdings, Ltd. is now the reporting entity and the ultimate parent company of the operating entities. Basis of Presentation These consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the U.S. (“GAAP”). All intercompany balances and transactions have been eliminated upon consolidation. All dollar figures presented in tables in the notes to consolidated financial statements are in thousands, except per share amounts. Year End We use a 52‑ or 53‑week fiscal year ending on the last Friday in December. The years ended December 31, 2021, December 25, 2020, and December 27, 2019 were all 53 weeks, 52 weeks, and 52 weeks, respectively. All references to 2021, 2020, and 2019 are references to the fiscal years then ended. Use of Estimates The preparation of consolidated financial statements in conformity with 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 financial statements and the reported amounts of revenue and expenses during the reporting periods presented. We base our estimates and judgments on historical experience and on various other assumptions that we believe are reasonable under the circumstances. Actual results could differ from the estimates made by management. Significant estimates include the fair value of assets and liabilities acquired in acquisitions, estimated useful lives for long‑lived assets, inventory valuation, uncertain tax positions, fair value assigned to stock options granted, and impairment analysis for both definite‑lived intangible assets and goodwill . Cash and Cash Equivalents and Marketable Securities Cash and cash equivalents consist of deposits and financial instruments which are readily convertible into cash and have original maturities of 90 days or less at the time of acquisition. Marketable securities consist primarily of highly liquid investments with maturities of greater than 90 days when purchased. We classify our marketable securities as available-for-sale and, accordingly, report them at fair value with the related unrealized gains and losses included in accumulated other comprehensive income (loss). Any unrealized losses which are considered to be other-than-temporary are recorded in other income (expense), net. Realized gains and losses on the sale of marketable securities are determined using the specific-identification method and recorded in other income (expense), net. Although we had marketable securities outstanding during 2021, we had no marketable securities outstanding as of December 31, 2021 or December 25, 2020. Available-for-sale investments are subject to a periodic impairment review. If an available-for-sale debt security’s fair value is less than its amortized cost basis, then we evaluate whether the decline is the result of a credit loss, in which case an impairment is recorded through an allowance for credit losses. Unrealized gains and losses not attributable to credit losses are included, net of tax, in accumulated other comprehensive income (loss). We have no t recorded an allowance for credit losses in 2021. F-9 Revenue Recognition We recognize revenue when control of promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. This amount is recorded as net sales in our consolidated statements of operations. Transaction price – In most of our contracts, prices are generally determined by a customer-issued purchase order and generally remain fixed over the duration of the contract. Certain contracts contain variable consideration, including early-payment discounts and rebates. When a contract includes variable consideration, we evaluate the estimate of the variable consideration to determine whether the estimate needs to be constrained; therefore, we include the variable consideration in the transaction price only to the extent that it is probable that a significant reversal will not occur. Variable consideration estimates are updated at each reporting date. Historically, we have not incurred significant costs to obtain a contract. All amounts billed to a customer relating to shipping and handling are classified as net sales, while all costs incurred by us for shipping and handling are classified as cost of sales. Performance obligations – Substantially all of our performance obligations pertain to promised goods (“products”), which are primarily comprised of fluid delivery subsystems, weldments, and other components. Most of our contracts contain a single performance obligation and are generally completed within twelve months . Product sales are recognized at a point-in-time, generally upon delivery, as such term is defined within the contract, as that is when control of the promised good has transferred. Products are covered by a standard assurance warranty, generally extended for a period of one to two years depending on the customer, which promises that delivered products conform to contract specifications. As such, we account for such warranties under ASC 460, Guarantees , and not as a separate performance obligation . Contract balances – Accounts receivable represents our unconditional right to receive consideration from our customers. Accounts receivable are carried at invoice price less an estimate for doubtful accounts and estimated payment discounts. Payment terms vary by customer but are generally due within 15 – 60 days . Historically, we have not incurred significant payment issues with our customers. We had no significant contract assets or liabilities on our consolidated balance sheets in any of the periods presented. Commitments and Contingencies We are periodically involved in legal actions and claims that arise as a result of events that occur in the normal course of operations. The ultimate resolution of these actions is not expected to have a material adverse effect on our financial position or results of operations. Concentrations Financial instruments that subject us to credit risk consist of accounts receivable, accounts payable, and long-term debt. At December 31, 2021 and December 25, 2020, two customers represented, in the aggregate, approximately 60 % and 73 %, respectively, of the balance of accounts receivable. We establish an allowance for doubtful accounts based upon the credit risk of specific customers, historical trends, and other information. We require collateral, typically cash, in the normal course of business if customers do not meet the criteria established for offering credit. If the financial condition of our customers were to deteriorate and result in an impaired ability to make payments, additions to the allowance may be required. Accounts receivable are written off when deemed uncollectible. Recoveries of accounts receivable previously written off are recorded to income when received. Activity and balances related to our allowance for doubtful accounts was not significant during any period presented. We use qualified manufacturers to supply many components and subassemblies of our products. We obtain the majority of our components from a limited group of suppliers. A majority of the purchased components used in our products are customer specified. An interruption in the supply of a particular component would have a temporary adverse impact on our operating results. We maintain cash balances at both United States-based and foreign-based commercial banks. Cash balances in the United States exceed amounts that are insured by the Federal Deposit Insurance Corporation (FDIC). The majority of the cash maintained in foreign-based commercial banks is insured by the government where the foreign banking institutions are based. Cash held in foreign-based commercial banks totaled $ 41.5 million and $ 39.9 million at December 31, 2021 and December 25, 2020, respectively, and at times exceeds insured amounts. No losses have been incurred as of December 31, 2021 or December 25, 2020 for amounts exceeding the insured limits. F-10 Fair Value Measurements We estimate the fair value of financial assets and liabilities based upon comparison of such assets and liabilities to the current market values for instruments of a similar nature and degree of risk. We utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. We determine fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: ▪ Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date ▪ Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability ▪ Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date There were no changes to our valuation techniques during 2021. We estimate the recorded value of our financial assets and liabilities approximates fair value at December 31, 2021 and December 25, 2020. We estimate the value of acquired intangible assets, on a nonrecurring basis, based on an income approach utilizing discounted cash flows. Under this approach, we estimate the future cash flows from our asset groups and discount the income stream to its present value to arrive at fair value. Future cash flows are based on recently prepared operating forecasts. Operating forecasts and cash flows include, among other things, revenue growth rates that are calculated based on management’s forecasted sales projections. A discount rate is utilized to convert the forecasted cash flows to their present value equivalent. The discount rate applied to the future cash flows includes a subject-company risk premium, an equity market risk premium, a beta, and a risk-free rate. As this approach contains unobservable inputs, the measurement of fair value for intangible assets is classified as Level 3. Inventories Inventories are stated at the lower of cost or net realizable value. The majority of our inventory values are based upon standard costs. On a quarterly basis, we analyze the value of our inventory and periodically record write-downs for estimated excess and obsolete inventory. This analysis is based on estimated future consumption compared to inventory quantities on-hand. The estimate is based on how assumptions of historical consumption, recency of purchases, backlog, and other factors indicate future consumption. Once the value of inventory is adjusted, the original cost of our inventory, less the write-down, represents its new cost basis. Reversal of these write-downs are recognized only when the related inventory has been scrapped or sold . Property and Equipment Property and equipment are stated at cost, less accumulated depreciation. Depreciation is computed using the straight-line method over the following estimated useful lives: Estimated useful lives of property & equipment Machinery 5 - 10 years Leasehold improvements 10 years Computer software, hardware, and equipment 3-5 years Office furniture, fixtures, and equipment 5-7 years Vehicles 5 years Maintenance and repairs that neither add material value to the asset nor appreciably prolong its useful life are charged to expense as incurred. Gains or losses on the disposal of property and equipment are included in selling, general, and administrative expenses on the consolidated statements of operations. F-11 Leases We determine if an arrangement is a lease, or contains a lease, at the inception of the arrangement. If we determine the arrangement is a lease, or contains a lease, at lease inception, we then determine whether the lease is an operating lease or a finance lease. Operating and finance leases result in recording a right-of-use (“ROU”) asset and lease liability on our consolidated balance sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. For purposes of calculating operating lease ROU assets and operating lease liabilities, we use the non-cancellable lease term plus options to extend that we are reasonably certain to take. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term. Our leases generally do not provide an implicit rate. As such, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. This rate is generally consistent with the interest rate we pay on borrowings under our credit facilities, as this rate approximates our collateralized borrowing capabilities over a similar term of lease payments. We utilize the consolidated group incremental borrowing rate for all leases, as we have centralized treasury operations. We have elected not to recognize ROU assets and lease liabilities that arise from short-term (12 months or less) leases for any class of underlying asset. We have elected not to separate lease and non-lease components for any class of underlying asset. Long-Lived Assets Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate, in management’s judgment, that the carrying amount of an asset (or asset group) may not be recoverable. In analyzing potential impairments, projections of future cash flows from the asset group are used to estimate fair value. If the sum of the expected future undiscounted cash flows is less than the carrying amount of the asset group, a loss is recognized for the difference between the estimated fair value and the carrying value of the asset group. The projections are based on assumptions, judgments, and estimates of revenue growth rates for the related business; anticipated future economic, regulatory, and political conditions; the assignment of discount rates relative to risk; and estimates of terminal values. During 2021, 2020, and 2019, we did not identify any triggering events that would indicate impairment. Intangible Assets We account for intangible assets that have a definite life and are amortized on a basis consistent with their expected cash flows over the following estimated useful lives: Estimated useful lives of intangible assets Trademarks 10 years Customer relationships 6-10 years Developed technology 7-10 years Goodwill Goodwill represents the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. We review goodwill for impairment annually and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. We first make a qualitative assessment of whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount before applying a quantitative goodwill impairment test. Under the quantitative test, the fair value of the reporting unit is compared to its carrying value and an impairment loss is recognized for any excess of carrying amount over the reporting unit’s fair value. Fair value of the reporting unit is determined using a discounted cash flow analysis. For purposes of testing goodwill for impairment, we have concluded that we operate as one reporting unit. We performed a qualitative goodwill assessment at December 31, 2021 and December 25, 2020. This assessment indicated that it was more likely than not our reporting unit’s fair value exceeded its carrying value. Research and Development Costs Research and development costs are expensed as incurred. F-12 Share-Based Payments We use the Black-Scholes option-pricing model to value awards on the date of grant. We use the simplified method to estimate the expected term of share-based awards for all periods as we do not have sufficient history to estimate the weighted average expected term. The risk-free interest rate is based on the U.S. Treasury rates in effect on the corresponding date of grant. Estimated volatility is based on the historical volatility of ours and similar entities’ publicly traded shares. Income Taxes We recognize deferred income taxes using the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred income taxes are recognized for differences between the financial reporting and tax bases of assets and liabilities at enacted statutory tax rates in effect for the years in which the differences are expected to reverse. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense for the current year differs from the statutory rate primarily as a result of the impact of foreign operations and discrete tax benefits recorded in connection with our historical acquisitions and stock option exercises. When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others may be subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the consolidated financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 % likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in our consolidated balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination. We recognize interest and penalties as a component of income tax expense. Foreign Operations The functional currency of our international operations is the U.S. dollar. Transactions denominated in currencies other than the functional currency generate foreign exchange gains and losses that are included in other expense (income), net on our consolidated statements of operations. Substantially all of our sales contracts, and most of our agreements with third-party suppliers, provide for pricing and payment in U.S. dollars. Accordingly, these transactions are not subject to material exchange rate fluctuations. Accounting Pronouncements Recently Adopted In June 2016, the FASB issued ASU 2016‑13, Financial Instruments–Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . This standard changes the methodology for measuring credit losses on financial instruments and the timing of when such losses are recorded. We adopted the standard on the first day of 2020, and the adoption did not have a significant impact on our financial statements. In August 2018, the FASB issued ASU 2018‑15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350‑40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract . The new guidance clarifies the accounting for implementation costs in cloud computing arrangements. We adopted the standard on the first day of 2020. During the 2020, we incurred capitalizable implementation costs of approximately $ 4.4 million in connection with our implementation of a new company-wide ERP system that is classified as a hosting arrangement that is a service contract. Accordingly, these costs are included in Other noncurrent assets on our consolidated balance sheet as of December 25, 2020. Additionally, our cash provided by operating activities for 2020 includes $ 3.3 million in cash outflows associated with these capitalized implementation costs. As the ERP system was not yet in-service as of December 25, 2020, there was no amortization expense recognized during 2020. In December 2019, the FASB issued ASU 2019‑12, Income Taxes (Topic 740) – Simplifying the Accounting for Income Taxes , as part of its initiative to reduce complexity in accounting standards. The amendments in the ASU include removing exceptions to incremental intraperiod tax allocation of losses and gains from different financial statement components, exceptions to the method of recognizing income taxes on interim period losses, and exceptions to deferred tax liability recognition related to foreign subsidiary investments. In addition, the ASU requires that entities recognize franchise tax based on an incremental method and requires an entity to evaluate the accounting for step-ups in the tax basis of goodwill as inside or outside of a business combination. We adopted the standard on the first day of 2021, and the adoption did not have a significant impact on our financial statements. F-13 Accounting Pronouncements Recently Issued In October 2021, the FASB issued ASU No. 2021‑08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (Topic 805) . This ASU requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities (deferred revenue) from acquired contracts using the revenue recognition guidance in Topic 606. At the acquisition date, the acquirer applies the revenue model as if it had originated the acquired contracts. The ASU is effective for annual periods beginning after December 15, 2022, including interim periods within those fiscal years. Adoption of the ASU should be applied prospectively. Early adoption is also permitted, including adoption in an interim period. If early adopted, the amendments are applied retrospectively to all business combinations for which the acquisition date occurred during the fiscal year of adoption. This ASU is currently not expected to have a material impact on our consolidated financial statements. Note 2 – Acquisitions IMG Companies, LLC On November 19, 2021 we completed the acquisition, via merger, of IMG Companies, LLC and its subsidiaries (“IMG”), a California-based precision machining, specialty joining, and plating company for an aggregate purchase price of $ 270.0 million. IMG provides us increased capacity and capabilities in our precision machining business, and expands our served customer base with new component and service offerings. The following table presents the preliminary purchase price allocation as of November 19, 2021. As of December 31, 2021, total acquisition consideration remains preliminary, as we are still finalizing the working capital adjustment component of final purchase price under the merger agreement. Preliminary Allocation November 19, 2021 Cash acquired $ 1,234 Accounts receivable 8,559 Inventories 12,128 Prepaid expenses and other current assets 579 Property and equipment 33,067 Operating lease right-of-use assets 14,509 Intangible assets 65,000 Goodwill 161,015 Accounts payable ( 3,853 ) Accrued expenses ( 5,620 ) Other current liabilities ( 2,109 ) Lease liabilities ( 14,509 ) Total acquisition consideration $ 270,000 We preliminarily allocated $ 62.4 million to IMG’s customer relationships and $ 2.6 million to IMG’s order backlog with weighted average amortization periods of 10 years and 6 months, respectively. Preliminary goodwill recognized from the acquisition was primarily attributed to an assembled workforce and expected synergies. We incurred transaction costs of approximately $ 4.4 million in connection with the acquisition during 2021. The fair value adjustment to inventory as part of our preliminary purchase price allocation resulted in a $ 1.4 million charge to cost of sales during 2021. Our consolidated statement of operations for 2021 includes approximately 6 weeks operating activity of IMG, including sales of $ 7.3 million. F-14 The following unaudited pro forma consolidated results of operations assume the acquisition was completed on December 26, 2020, the beginning of the earliest period presented. Pro forma adjustments are primarily comprised of preliminary estimates of amortization expense related to acquired intangible assets, incremental interest expense from increased borrowings to fund the acquisition and the elimination of IMG’s historical interest expense, elimination of IMG’s non-recurring management expenses, elimination of a gain on forgiveness of debt, acquired inventory fair value charges, the related income tax effects, and other insignificant management adjustments. The pro forma results of operations are presented for informational purposes only and are not indicative of the results of operations that would have been achieved or of results that may occur in the future. Year Ended December 31, 2021 December 25, 2020 Net sales $ 1,156,619 $ 962,642 Net income $ 74,531 $ 26,048 Net income per share: Basic $ 2.64 $ 1.12 Diluted $ 2.57 $ 1.11 Nogales, Mexico Precision Machining Acquisition On December 1, 2020, we acquired certain operating assets and assumed the operations of a precision machining operation in Nogales, Mexico, which was considered a business combination under ASC 805 – Business Combinations , for an aggregate purchase of $ 5.0 million. The acquisition adds to our precision machined component manufacturing capacity. In connection with the acquisition, we recorded $ 2.0 million in tangible operating assets, a $ 1.2 million customer relationship intangible asset, which will be amortized of a period of 6 years, and $ 1.9 million in goodwill. Note 3 – Inventories Inventories consist of the following: December 31, 2021 December 25, 2020 Raw materials $ 159,366 $ 88,015 Work in process 62,537 38,184 Finished goods 28,281 21,299 Excess and obsolete adjustment ( 14,051 ) ( 12,742 ) Total inventories $ 236,133 $ 134,756 The following table presents changes to our excess and obsolete adjustment: Excess and obsolete adjustment Balance at December 28, 2018 $ ( 7,692 ) Charge to cost of sales ( 1,086 ) Disposition of inventory 961 Balance at December 27, 2019 ( 7,817 ) Charge to cost of sales ( 4,649 ) Disposition of inventory ( 276 ) Balance at December 25, 2020 ( 12,742 ) Charge to cost of sales ( 1,942 ) Disposition of inventory 633 Balance at December 31, 2021 $ ( 14,051 ) F-15 Note 4 – Property and Equipment Property and equipment consist of the following: December 31, 2021 December 25, 2020 Machinery $ 80,953 $ 37,196 Leasehold improvements 36,706 29,616 Computer software, hardware, and equipment 8,031 6,501 Office furniture, fixtures and equipment 1,168 1,166 Vehicles 284 75 Construction-in-process 8,565 5,483 135,707 80,037 Less accumulated depreciation ( 50,503 ) ( 38,226 ) Total property and equipment, net $ 85,204 $ 41,811 Depreciation expense for 2021, 2020, and 2019 was $ 11.1 million, $ 10.9 million, and $ 8.9 million, respectively. Cloud Computing Implementation Costs Pursuant to ASU 2018-15, we capitalize implementation costs associated with hosting arrangement that are service contracts. These costs are recorded to prepaid expenses or other noncurrent assets. To-date, these costs are those incurred to implement a new company-wide ERP system. The following table summarizes capitalized cloud computing implementation costs: Capitalized cloud computing implementation costs as of December 27, 2019 $ — Costs capitalized during the period 4,366 Capitalized costs amortized during the period — Capitalized cloud computing implementation costs as of December 25, 2020 4,366 Costs capitalized during the period 3,992 Capitalized costs amortized during the period ( 304 ) Capitalized cloud computing implementation costs as of December 31, 2021 $ 8,054 Note 5 – Intangible Assets and Goodwill Definite-lived intangible assets consist of the following: December 31, 2021 Gross value Accumulated amortization Accumulated impairment charges Carrying amount Weighted average useful life Customer relationships 146,569 ( 65,953 ) — 80,616 8.7 years Developed technology 11,047 ( 3,483 ) — 7,564 10.0 years Order backlog 2,600 ( 853 ) — 1,747 6 months Total intangible assets $ 160,216 $ ( 70,289 ) $ — $ 89,927 December 25, 2020 Gross value Accumulated amortization Accumulated impairment charges Carrying amount Weighted average useful life Trademarks $ 9,690 $ ( 8,717 ) $ — $ 973 10.0 years Customer relationships 84,169 ( 53,946 ) — 30,223 7.8 years Developed technology 11,047 ( 2,398 ) — 8,649 10.0 years Total intangible assets $ 104,906 $ ( 65,061 ) $ — $ 39,845 F-16 Future projected annual amortization expense consists of the following: Future amortization expense 2022 $ 17,763 2023 14,803 2024 8,435 2025 8,311 2026 7,730 Thereafter 32,885 $ 89,927 The following tables present the changes to goodwill: Goodwill Balance at December 28, 2018 $ 173,010 Acquisitions — Balance at December 27, 2019 173,010 Acquisitions 1,877 Balance at December 25, 2020 174,887 Acquisitions 161,015 Balance at December 31, 2021 $ 335,902 Note 6 – Leases We lease facilities under various non-cancellable operating leases expiring through 2031 . In addition to base rental payments, we are generally responsible for our proportionate share of operating expenses, including facility maintenance, insurance, and property taxes. As these amounts are variable, they are not included in lease liabilities. As of December 31, 2021, we had one operating leases executed for which the rental period had not yet commenced. The components of lease expense are as follows: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Operating lease cost $ 5,763 $ 5,397 $ 5,420 Supplemental cash flow information related to leases is as follows: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 5,477 $ 5,574 $ 5,220 Supplemental balance sheet information related to leases is as follows: December 31, 2021 December 25, 2020 Weighted-average remaining lease term of operating leases 5.8 years 2.3 years Weighted-average discount rate of operating leases 2.4 % 4.5 % F-17 Future minimum lease payments under non-cancellable leases as of December 31, 2021 are as follows 2022 $ 7,633 2023 5,401 2024 4,550 2025 4,230 2026 3,737 Thereafter 6,292 Total future minimum lease payments 31,843 Less imputed interest ( 1,856 ) Total lease liabilities $ 29,987 Note 7 – Income Taxes On March 27, 2020 the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was signed into law. The CARES Act allows net operating losses from the 2018, 2019 and 2020 tax years to be carried back up to five years . As a result, during 2020 we were able to carry back our 2019 net operating loss to tax years 2017 and 2018, resulting in a $ 1.0 million refund claim. The CARES Act also provided for an increased interest deduction for tax years 2019 and 2020, as well as the deferral of the employer portion of social security taxes. Income before tax was as follows: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 United States $ 13,435 $ ( 2,558 ) $ ( 20,993 ) Foreign 60,321 34,849 25,268 Income before tax $ 73,756 $ 32,291 $ 4,275 Significant components of income tax expense (benefit) consist of the following: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Current: Federal $ 430 $ ( 1,103 ) $ ( 812 ) State 1,524 341 649 Foreign 2,766 1,461 868 Total current tax expense 4,720 699 705 Deferred: Federal ( 889 ) ( 1,321 ) ( 5,315 ) State ( 771 ) ( 196 ) ( 1,218 ) Foreign ( 203 ) ( 170 ) ( 626 ) Total deferred tax benefit ( 1,863 ) ( 1,687 ) ( 7,159 ) Income tax expense (benefit) $ 2,857 $ ( 988 ) $ ( 6,454 ) F-18 The reconciliation of income tax computed at the U.S. federal statutory tax rates to income tax expense (benefit) consist of the following: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Effective rate reconciliation: U.S. federal tax expense $ 15,489 $ 6,781 $ 898 State income taxes, net 577 105 ( 523 ) Permanent items 680 298 ( 75 ) Foreign rate differential ( 1,897 ) ( 1,325 ) ( 1,051 ) Tax holiday ( 9,653 ) ( 5,911 ) ( 4,582 ) Credits ( 1,647 ) ( 1,411 ) ( 918 ) Tax contingencies 482 80 ( 830 ) Share-based compensation ( 2,640 ) ( 1,002 ) ( 285 ) Withholding tax 1,044 819 554 Other, net 385 330 201 Valuation allowance 37 248 157 Income tax expense (benefit) $ 2,857 $ ( 988 ) $ ( 6,454 ) Deferred income tax assets and liabilities consist of the following: December 31, 2021 December 25, 2020 Deferred tax assets: Inventory $ 4,643 $ 3,836 Share-based compensation 2,551 2,266 Accrued payroll 2,140 2,370 Net operating loss carryforwards 816 873 Tax credits 5,103 7,943 Intercompany interest 1,907 1,689 Operating lease liabilities 7,450 2,616 Other assets 755 414 Deferred tax assets 25,365 22,007 Valuation allowance ( 556 ) ( 518 ) Total deferred tax assets 24,809 21,489 Deferred tax liabilities: Intangible assets ( 3,265 ) ( 7,344 ) Property, plant and equipment ( 5,928 ) ( 5,273 ) Operating lease right-of-use assets ( 7,409 ) ( 2,568 ) Other liabilities ( 129 ) ( 89 ) Total deferred tax liabilities ( 16,731 ) ( 15,274 ) Net deferred tax asset $ 8,078 $ 6,215 At December 31, 2021, we had federal, state, and foreign net operating loss carryforwards of zero , $ 4.8 million, and $ 2.1 million respectively. The state and foreign net operating loss carryforwards, if not utilized, will begin to expire in 2032, and 2029, respectively. At December 31, 2021, we had federal and state research and development credits of $ 2.9 million and zero , respectively. The federal research and development credits, if not utilized, will begin to expire in 2034. Additionally, we had foreign tax credits of $ 0.6 million, which if not utilized, will begin to expire in 2027. We have determined the amount of our valuation allowance based on our estimates of taxable income by jurisdiction in which we operate over the periods in which the related deferred tax assets will be recoverable. As of December 31, 2021, we believe it is more-likely-than-not that we will realize our U.S. deferred tax assets, with the exception of certain state and foreign net operating loss carryforwards we believe are not likely to be realized within the carryforward period. F-19 We were granted a tax holiday for our Singapore operations that is effective through 2026. The net impact of the tax holiday in Singapore as compared to the Singapore statutory rate was a benefit of $ 9.7 million, $ 5.9 million, and $ 4.6 million during 2021, 2020, and 2019, respectively. Our income tax fluctuates based on the geographic mix of earnings and is calculated quarterly based on actual results pursuant to ASC Topic 740‑270. As of December 31, 2021, we have recognized $ 3.0 million of unrecognized tax benefits in other non-current liabilities in our consolidated balance sheet. If recognized, $ 1.5 million of this amount would impact our effective tax rate. We expect a decrease of $ 0.1 million to the total amount of unrecognized tax benefits within the next twelve months. Our ongoing practice is to recognize potential accrued interest and penalties related to unrecognized tax benefits within our statements of operations in income tax expense (benefit). Interest and penalties associated with uncertain tax positions recognized during 2021 and 2020 were insignificant. At December 31, 2021, other non-current liabilities on our balance sheet included approximately zero and $ 0.5 million of interest and penalties, respectively, associated with uncertain tax positions, which are excluded from the unrecognized tax benefits table below. The following table summarizes the activity related to our unrecognized tax benefits: Unrecognized tax benefits Balance at December 28, 2018 $ 2,256 Increase related to current year tax positions 380 Increase related to prior year tax positions 8 Decrease in tax positions related to lapse of statute of limitations and settlements ( 784 ) Balance at December 27, 2019 1,860 Increase related to current year tax positions 378 Increase related to prior year tax positions 484 Decrease in tax positions related to lapse of statute of limitations ( 232 ) Balance at December 25, 2020 2,490 Increase related to current year tax positions 597 Decrease in tax positions related to lapse of statute of limitations ( 92 ) Balance at December 31, 2021 $ 2,995 We assert indefinite reinvestment of our U.S. and Netherlands unremitted earnings. With regard to these unremitted earnings, we have not, nor do we anticipate the need to repatriate funds from the U.S. to the Netherlands or from the Netherlands to the Cayman entity to satisfy liquidity needs. Determination of the amount of unrecognized withholding tax liability related to the indefinitely reinvested earnings is not practicable. Our three major filing jurisdictions are the United States, Singapore and Malaysia. We are no longer subject to U.S. Federal examination for tax years ending before 2017, to state examinations before 2017, or to foreign examinations before 2016. However, to the extent allowed by law, the tax authorities may have the right to examine prior periods where net operating losses or tax credits were generated and carried forward, and make adjustments up to the amount of the net operating losses or credit carryforward. At December 31, 2021, we were not under examination by a tax authority. Note 8 – Employee Benefit Programs 401(k) Plan We sponsor a 401(k) plan available to employees of our U.S.‑based subsidiaries. Participants may make salary deferral contributions not to exceed 50 % of a participant’s annual compensation or the maximum amount otherwise allowed by law. Eligible employees receive a discretionary matching contribution equal to 50 % of a participant’s deferral, up to an annual maximum of 4 % of a participant’s annual compensation. For 2021, 2020, and 2019, matching contributions were $ 2.2 million, $ 1.9 million, and $ 1.5 million, respectively. F-20 Note 9 – Long-Term Debt Long-term debt consists of the following: December 31, 2021 December 25, 2020 Term loan $ 150,000 $ 153,125 Revolving credit facility 145,000 49,162 Total principal amount of long-term debt 295,000 202,287 Less unamortized debt issuance costs ( 2,247 ) ( 2,015 ) Total long-term debt, net 292,753 200,272 Less current portion ( 7,500 ) ( 8,750 ) Total long-term debt, less current portion, net $ 285,253 $ 191,522 Maturities of long-term debt consist of the following: Future maturities of long-term debt 2022 $ 7,500 2023 7,500 2024 7,500 2025 7,500 2026 265,000 Total $ 295,000 The weighted average interest rate across our credit facilities was 2.74 %, 3.75 %, and 4.78 % during 2021, 2020, and 2019, respectively. On October 29, 2021, we entered into an amended and restated credit agreement, which includes a group of financial institutions as direct lenders underlying the agreement. The credit agreement includes a $ 150.0 million term loan facility and a $ 250.0 million revolving credit facility (“credit facilities”). We incurred debt issuance costs of approximately $ 1.9 million in connection with the amendment and restatement. We account for debt issuance costs as a reduction to the carrying value of our long-term debt, and we amortize the costs to interest expense over the term of the credit agreement. Under the debt modification literature codified in ASC 470, a portion of the amendment and restatement was treated as an extinguishment. Accordingly, $ 0.7 million of existing capitalized debt issuance costs were written off as a loss on extinguishment of debt, which is included in other expense (income), net on our statements of operations. Term loan payments of $ 1.9 million are due on a quarterly basis. The credit agreement matures on October 29, 2026 . Our credit agreement is secured by our tangible and intangible assets and includes customary representations, warranties, and covenants. We are required to maintain a minimum fixed charge coverage ratio of 1.25 : 1 and a maximum leverage ratio 3.50 : 1 to 4.00 :1. Interest is charged at either the Base Rate or the Bloomberg Short-Term Bank Yield (“BSBY”) Rate (as such terms are defined in the credit agreement) at our option, plus an applicable margin. The Base Rate is equal to the higher of i) the Prime Rate, ii) the Federal Funds Rate plus 0.5 %, or iii) the BSBY Rate plus 1.00 %. The applicable margin on Base Rate and BSBY Rate loans is 0.375 ‑ 1.375 % and 1.375 ‑ 2.375 % per annum, respectively, depending on our leverage ratio. We are also charged a commitment fee of 0.175 %- 0.350 % on the unused portion of our revolving credit facility. Base Rate interest payments and commitment fees are due quarterly . BSBY rate interest payments are due on the last day of the applicable interest period, or quarterly for applicable interest periods longer than 3 months . At December 31, 2021, our credit facilities bore interest under the BSBY rate option of 1.81 %. Note 10 – Shareholders’ Equity Public Offering of Shares On December 14, 2020, we completed an underwritten public offering of 4.6 million ordinary shares with net proceeds of $ 139.4 million, after deducting the underwriting discount of $ 1.35 per share and incremental offering expenses of $ 0.5 million. F-21 Share Repurchase Program In February 2018, our Board of Directors authorized a share repurchase program up to $ 50.0 million under which we may repurchase our ordinary shares in the open market or through privately negotiated transactions, depending on market conditions and other factors. Ordinary shares repurchased are recorded as treasury shares using the cost method on a first-in, first-out basis. In August 2018, our Board of Directors authorized a $ 50.0 million increase to the share repurchase program. The following tables details our share repurchases for the periods indicated: Total Number of Shares Repurchased Total Cost of Repurchase Average Price Paid per Share Amount Available Under Repurchase Program Amount available at December 28, 2018 $ 10,021 Quarter ended March 29, 2019 97,910 1,599 $ 16.33 $ 8,421 Quarter ended June 28, 2019 — — $ — $ 8,421 Quarter ended September 27, 2019 — — $ — $ 8,421 Quarter ended December 27, 2019 — — $ — $ 8,421 Year ended December 27, 2019 97,910 $ 1,599 $ 16.33 $ 8,421 Note 11 – Share-Based Compensation 2016 Plan In December 2016, we adopted the 2016 Omnibus Incentive Plan (“the 2016 Plan”). The 2016 Plan provides for grants of share‑based awards to employees, directors, and consultants . Under the 2016 Plan, 1,888,000 ordinary shares were reserved for issuance. The number of shares reserved for issuance under the 2016 Plan increases annually beginning in fiscal year 2018 by the lesser of (i) 2 % of the ordinary shares outstanding on the last day of the immediately preceding fiscal year or (ii) such amount determined by our Board of Directors. Awards may be in the form of stock options (“options”), tandem and non‑tandem stock appreciation rights, restricted share awards or restricted share units (“RSUs”), performance awards, and other share‑based awards . Forfeited or expired awards are returned to the incentive plan pool for future grants. Options granted under the 2016 Plan generally have a term of 7 years. Vesting of options and RSUs generally occurs 25 % on the first anniversary of the date of grant and quarterly thereafter over the remaining 3 years. Upon vesting of RSUs, employees may elect to have shares withheld to cover statutory minimum withholding taxes. Shares withheld are not reflected as an issuance of ordinary shares within our consolidated statements of shareholders’ equity, as the shares were never issued, and the associated tax payments are reflected as financing activities within our consolidated statements of cash flows. 2012 Plan In March 2012, we adopted the Ichor Holdings Ltd. 2012 Equity Incentive Plan (the “2012 Plan”). Under the 2012 Plan, we could grant either restricted shares, RSUs, or options to employees, directors, and consultants. Options granted under the 2012 Plan generally had a term of 7 years. Vesting of options and RSUs generally occurred 25 % on the first anniversary of the date of grant and quarterly thereafter over the remaining 3 years. There have been no issuances of equity-based awards under the 2012 Plan since the adoption of the 2016 Plan. Share‑based compensation expense across all plans for options, RSUs, and employee share purchase rights was $ 11.5 million, $ 9.9 million, and $ 8.5 million during 2021, 2010, and 2019, respectively. On November 12, 2019, in connection with the transition of our former Chief Executive Officer to Executive Chairman, the Compensation Committee of the Board of Directors modified all outstanding equity awards such that the next 18 months of vesting events would be pulled forward and become immediately vested on January 6, 2020. Consequently, 98,825 options and 60,721 RSUs vested on January 6, 2020. This was accounted for as a probable-to-probable modification under ASC Topic 718, resulting in approximately $ 1.4 million in share-based compensation expense pulled forward into 2019. F-22 Stock Options The table below sets forth the weighted average assumptions used to measure the fair value of options granted: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Weighted average expected term -- 5 years 5 years Risk-free interest rate -- 0.5 % 2.1 % Dividend yield -- 0.0 % 0.0 % Volatility -- 61.5 % 55.3 % The following table summarizes option activity: Number of Stock Options Service condition Performance condition Weighted average exercise price per share Weighted average remaining contractual term Aggregate intrinsic value Outstanding, December 25, 2020 1,325,826 65,908 $ 22.22 Granted — — $ — Exercised ( 344,650 ) ( 65,908 ) $ 20.19 Forfeited or expired ( 59,707 ) — $ 21.15 Outstanding, December 31, 2021 921,469 — $ 23.20 3.8 years $ 21,035 Exercisable, December 31, 2021 608,373 — $ 22.96 3.4 years $ 14,056 Fair value information for options granted and the intrinsic value of options exercised are as follows: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Weighted average grant-date fair value of options granted -- $ 12.10 $ 11.33 Total intrinsic value of options exercised $ 11,859 $ 7,292 $ 3,619 At December 31, 2021, total unrecognized share-based compensation expense relating to options was $ 3.2 million, with a weighted average remaining service period of 1.8 years. Restricted Share Units The following table summarizes RSU activity: Number of Restricted Share Units Service condition Performance condition Market condition Weighted average grant-date fair value per share Unvested, December 25, 2020 564,626 — — $ 24.09 Granted 286,365 9,716 14,572 $ 49.59 Vested ( 242,626 ) — — $ 24.20 Forfeited ( 49,055 ) — — $ 30.76 Unvested, December 31, 2021 559,310 9,716 14,572 $ 37.05 Fair value information for RSUs granted and vested is as follows: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Weighted average grant-date fair value per share of RSUs granted $ 49.59 $ 24.50 $ 23.25 Total grant-date fair value of shares vested $ 5,871 $ 4,731 $ 2,217 F-23 At December 31, 2021, total unrecognized share-based compensation expense relating to RSUs was $ 17.6 million, with a weighted average remaining service period of 2.5 years. 2017 ESPP In May 2017, we adopted the 2017 Employee Stock Purchase Plan (the “2017 ESPP”). The 2017 ESPP grants employees the ability to designate a portion of their base-pay to purchase ordinary shares at a price equal to 85 % of the fair market value of our ordinary shares on the first or last day of each 6 month purchase period. Purchase periods begin on January 1 or July 1 and end on June 30 or December 31, or the next business day if such date is not a business day. Shares are purchased on the last day of the purchase period. As of December 31, 2021, 2.3 million ordinary shares remained eligible for issuance under the 2017 ESPP. The table below sets forth the weighted average assumptions used to measure the fair value of 2017 ESPP rights: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Weighted average expected term 0.5 years 0.5 years 0.5 years Risk-free interest rate 0.1 % 0.7 % 2.3 % Dividend yield 0.0 % 0.0 % 0.0 % Volatility 63.7 % 60.1 % 56.0 % We recognize share-based compensation expense associated with the 2017 ESPP over the duration of the purchase period. We recognized $ 0.6 million, $ 0.4 million, and $ 0.3 million of share-based compensation expense associated with the 2017 ESPP during 2021, 2020, and 2019, respectively. At December 25, 2020, there was no unrecognized share-based compensation expense. Note 12 – Segment Information Our Chief Operating Decision Maker, the Chief Executive Officer, reviews our results of operations on a consolidated level and executive staff is structured by function rather than by product category. Therefore, we operate in one operating segment. Key resources, decisions, and assessment of performance are also analyzed on a company‑wide level. Foreign operations are conducted primarily through our wholly owned subsidiaries in Singapore and Malaysia. Our principal markets include North America, Asia and, to a lesser degree, Europe. Sales by geographic area represent sales to unaffiliated customers. All information on sales by geographic area is based upon the location to which the products were shipped. The following table sets forth sales by geographic area: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 United States of America $ 544,109 $ 490,965 $ 329,037 Singapore 383,278 303,444 198,657 Europe 78,745 70,915 56,090 Other 90,785 48,912 37,053 Total net sales $ 1,096,917 $ 914,236 $ 620,837 The following table sets forth our two major customers, which comprised 85 %, 87 %, and 85 % of net sales in 2021, 2020, and 2019, respectively: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Lam Research $ 579,009 $ 475,933 $ 319,144 Applied Materials $ 352,077 $ 316,082 $ 207,391 Foreign long-lived assets, exclusive of deferred tax assets, were $ 38.4 million and $ 31.5 million at December 31, 2021 and December 25, 2020, respectively. F-24 Note 13 – Earnings per Share The following table sets forth the computation of our basic and diluted net income (loss) per share and a reconciliation of the numerator and denominator used in the calculation: Year Ended December 31, 2021 December 25, 2020 December 27, 2019 Numerator: Net income $ 70,899 $ 33,279 $ 10,729 Denominator: Basic weighted average ordinary shares outstanding 28,259,607 23,172,961 22,418,802 Dilutive effect of options 480,790 221,565 259,337 Dilutive effect of RSUs 237,357 61,761 85,603 Dilutive effect of ESPP 1,598 3,818 3,161 Diluted weighted average ordinary shares outstanding 28,979,352 23,460,105 22,766,903 Securities excluded from the calculation of diluted weighted average ordinary shares outstanding (1) 273,000 1,430,000 1,588,000 Earnings per share: Net income: Basic $ 2.51 $ 1.44 $ 0.48 Diluted $ 2.45 $ 1.42 $ 0.47 (1) Represents potentially dilutive options and RSUs that were excluded from the calculation of net income per share, because including them would have been antidilutive under the treasury stock method. F-25 EXHIBIT INDEX The following exhibits are filed with this Form 10‑K or are incorporated herein by reference: Exhibit Number Description of Exhibit 2.1 Agreement and Plan of Merger, dated November 11, 2021, by and among Ichor Systems, Inc., Incline Merger Sub, LLC, IMG Companies, LLC, and Brian J. Miller (solely in his capacity as the Equityholders’ Representative thereunder) (Incorporated by reference to Exhibit 10.1 to Ichor Holdings, Ltd.’s Current Report on Form 8‑K filed with the Securities and Exchange Commission on November 16, 2021). 3.1 Amended and Restated Memorandum and Articles of Association of Ichor Holdings, Ltd., effective as of December 9, 2016 (Incorporated by reference to Exhibit 3.1 to Ichor Holdings, Ltd.’s Current Report on Form 8‑K filed with the Securities and Exchange Commission on December 14, 2016). 4.1* Description of Securities of Ichor Holdings, Ltd. 10.1* Amended and Restated Credit Agreement, dated as of October 29, 2021, by and among Icicle Acquisition Holding B.V., Ichor Holdings, LLC, and Ichor Systems, Inc. as borrowers, Bank of America, N.A., as administrative agent, and the financial institutions party thereto, as lenders. 10.2 + Ichor Holdings, Ltd. 2016 Omnibus Incentive Plan (Incorporated by reference to Exhibit 10.11 to Ichor Holdings, Ltd’s Amendment No. 2 to Registration Statement on Form S‑1, filed with the Securities and Exchange Commission on November 29, 2016). 10.3 + Form of Incentive Stock Option Agreement (Incorporated by reference to Exhibit 10.12 to Ichor Holdings, Ltd’s Amendment No. 2 to Registration Statement on Form S‑1, filed with the Securities and Exchange Commission on November 29, 2016). 10.4 + Form of Restricted Stock Agreement (Incorporated by reference to Exhibit 10.13 to Ichor Holdings, Ltd’s Amendment No. 2 to Registration Statement on Form S‑1, filed with the Securities and Exchange Commission on November 29, 2016). 10.5 + Form of Nonqualifed Stock Option Agreement (Incorporated by reference to Exhibit 10.14 to Ichor Holdings, Ltd’s Amendment No. 2 Registration Statement on Form S‑1, filed with the Securities and Exchange Commission on November 29, 2016). 10.6 + Offer Letter, dated as of January 8, 2013, by and between Ichor Systems, Inc. and Philip Barros (Incorporated by reference to Exhibit 10.16 to Ichor Holdings, Ltd’s Registration Statement on Form S‑1, filed with the Securities and Exchange Commission on November 14, 2016). 10.7 + Offer Letter, dated as of September 30, 2015, by and between Ichor Systems, Inc. and Philip Barros (Incorporated by reference to Exhibit 10.17 to Ichor Holdings, Ltd’s Registration Statement on Form S‑1, filed with the Securities and Exchange Commission on November 14, 2016). 10.8 + Select Severance Plan, dated as of March 6, 2019, by and among Ichor Holdings, Ltd. and certain officers and directors party thereto (Incorporated by reference to Exhibit 10.9 to Ichor Holdings, Ltd.’s Annual Report on Form 10‑K filed with the Securities and Exchange Commission on March 8, 2019). 10.9 + Offer Letter, dated August 23, 2019, between Ichor Systems, Inc. and Larry Sparks (Incorporated by reference to Exhibit 10.1 to Ichor Holdings, Ltd.’s Current Report on Form 8‑K filed with the Securities and Exchange Commission on September 9, 2019). 10.10 + Offer Letter, dated November 20, 2019, between Ichor Systems, Inc. and Jeffrey Andreson (Incorporated by reference to Exhibit 10.12 to Ichor Holdings, Ltd.’s Annual Report on Form 10 K filed with the Securities and Exchange Commission on March 6, 2020). 10.11* Letter Agreement, dated December 23, 2021 between Ichor Systems, Inc. and Thomas Rohrs. 21.1* List of subsidiaries 23.1* Consent of KPMG LLP 31.1* Certifications of Chief Executive Officer of the Company under Rule 13a‑14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002. 31.2* Certifications of Chief Financial Officer of the Company under Rule 13a‑14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002. 32.1* Certifications of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002. This certification accompanies this report and shall not, except to the extent required by the Sarbanes‑Oxley Act of 2002, be deemed filed for purposes of §18 of the Securities Exchange Act of 1934, as amended. 32.2* Certifications of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002. This certification accompanies this report and shall not, except to the extent required by the Sarbanes‑Oxley Act of 2002, be deemed filed for purposes of §18 of the Securities Exchange Act of 1934, as amended. 101.INS Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) * Filed herewith + A management contract or compensatory arrangement required to be filed as an exhibit pursuant to Item 601 of Regulation S‑K SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Dated: February 28, 2022 ICHOR HOLDINGS, LTD. By: /s/ Jeffrey S. Andreson Jeffrey S. Andreson Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Name and Title Date /s/ Jeffrey S. Andreson Jeffrey S. Andreson Chief Executive Officer and Director (Principal Executive Officer) February 28, 2022 /s/ Larry J. Sparks Larry J. Sparks Chief Financial Officer (Principal Accounting and Financial Officer) February 28, 2022 /s/ Thomas M. Rohrs Thomas M. Rohrs Executive Chairman and Director February 28, 2022 /s/ Iain MacKenzie Lead Independent Director February 28, 2022 Iain MacKenzie /s/ Marc Haugen Marc Haugen Director February 28, 2022 /s/ John Kispert Director February 28, 2022 John Kispert /s/ Laura Black Laura Black Director February 28, 2022 /s/ Wendy Arienzo Wendy Arienzo Director February 28, 2022 /s/ Sarah O’Dowd Director February 28, 2022 Sarah O’Dowd /s/ Yuval Wasserman Director February 28, 2022 Yuval Wasserman