Kimball Electronics, Inc. 10-Q

Item 5. Other Information We are providing the following disclosure in this Form 10-Q in lieu of filing such information on a Current Report on Form 8-K. Item 1.01 Entry into a Material Definitive Agreement We entered into a 364-day multi-currency revolving credit facility agreement on February 3, 2023 (the “secondary credit facility”), which allows for borrowings up to $50 million, among the Company, as borrower, certain subsidiaries of the Company as guarantors, the lenders party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent and Bank of America, N.A., as Documentation Agent. The secondary credit facility has a maturity date of February 2, 2024. The proceeds of the loans are to be used for working capital and general corporate purposes of the Company. A commitment fee on the unused portion of principal amount of this secondary credit facility is payable at 30.0 basis points per annum. The interest rate on borrowings is dependent on the type of borrowings and will be one of the following options: • any Term Benchmark borrowing denominated in U.S. Dollars will utilize the Secured Overnight Financing Rate (“SOFR”), which is a rate per annum equal to the secured overnight financing rate for such business day published by the SOFR Administrator, the Federal Reserve Bank of New York, on the immediately succeeding business day, plus a Revolving Commitment Term Benchmark spread of 175.0 basis points; • any Term Benchmark borrowing denominated in Euros will utilize the Euro Interbank Offered Rate (“EURIBOR”) in effect two target days prior to the advance (adjusted upwards to reflect bank reserve costs) for such interest period as defined in the agreement, plus a Revolving Commitment Term Benchmark spread of 175.0 basis points; or • the Alternate Base Rate (“ABR”), which is defined as the highest of the fluctuating rate per annum equal to the higher of ◦ Prime Rate in the U.S. last quoted by the Wall Street Journal, and if this is ceased to be quoted, the highest bank prime loan rate or similar loan rate quoted by the Federal Reserve Board; ◦ 1/2 of 1% per annum above the Federal Funds Effective Rate (as defined under the primary credit facility); or ◦ 1% per annum above the Adjusted SOFR Rate (as defined under the primary credit facility); plus a Revolving Commitment ABR spread of 75.0 basis points. The Company’s financial covenants under this secondary credit facility are the same as the financial covenants for its primary credit facility. See Note 6 - Credit Facilities of Notes to Condensed Consolidated Financial Statements for further information on the financial covenants. 32 The foregoing description of the secondary credit facility does not purport to be complete and is qualified by its entirety by reference to the full text of the secondary credit facility, which is attached hereto as Exhibit 10.2 and incorporated herein by reference. In conjunction with the secondary credit facility, a related amendment to the primary credit facility (the “Amendment”) was entered into on February 3, 2023, to allow other borrowings that have a shorter tenor than our primary credit facility. The foregoing description of the Amendment to the primary credit facility does not purport to be complete and is qualified by its entirety by reference to the full text of the Amendment, which is attached hereto as Exhibit 10.3 and incorporated herein by reference. Item 2.03 Creation of a Direct Financial Obligation under an Off-Balance Sheet Arrangement of a Registrant The information set forth under Item 1.01 related to the secondary credit facility and the Amendment is incorporated by reference in this Item 2.03. 33 Item 6. Exhibits Exhibits (numbered in accordance with Item 601 of Regulation S-K) Incorporated by Reference Exhibit No. Description Form Period Ending Exhibit Filing Date 3.1 Amended and Restated Articles of Incorporation of the Company 8-K 3.1 2/18/2021 3.2 Amended and Restated By-Laws of the Company 8-K 3.2 11/15/2022 10.1 (a) Richard D. Phillips Job Offer Dated January 4, 2023 8-K 10.1 1/10/2023 10.2 Credit Agreement, dated as of February 3, 2023, among Kimball Electronics, Inc., the lenders party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent and Bank of America, N.A., as Documentation Agent Filed Herewith 10.3 First Amendment to Amended and Restated Credit Agreement, dated as of February 3, 2023, among Kimball Electronics, Inc., the lenders party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent and Bank of America, N.A., as Documentation Agent Filed Herewith 31.1 Certification filed by Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Filed Herewith 31.2 Certification filed by Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Filed Herewith 32.1 (b) Certification furnished by the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Furnished Herewith 32.2 (b) Certification furnished by the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Furnished Herewith 101.INS Inline XBRL Instance Document - The instance document does not appear in the Interactive Data File because its Inline XBRL tags are embedded within the Inline XBRL document Filed Herewith 101.SCH Inline XBRL Taxonomy Extension Schema Document Filed Herewith 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document Filed Herewith 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document Filed Herewith 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document Filed Herewith 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document Filed Herewith 104 Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101) Filed Herewith (a) Constitutes management contract or compensatory arrangement. (b) In accordance with Item 601(b)(32)(ii) of Regulation S-K, the certifications furnished in Exhibit 32.1 and 32.2 will not be deemed “filed” for purposes of Section 18 of the Exchange Act. Such certifications will not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference. 34 SIGNATURES Pursuant to the requirements 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. KIMBALL ELECTRONICS, INC. By: /s/ DONALD D. CHARRON Donald D. Charron Chairman of the Board, Chief Executive Officer February 7, 2023 By: /s/ JANA T. CROOM Jana T. Croom Chief Financial Officer February 7, 2023 35