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Item 1. Financial Statements

2023-11-03 compared with 2023-05-05 · 153 added, 222 removed, 352 unchanged (52% of the section changed)

2 unchanged sentences

Consolidated Balance Sheets

(In thousands, except share data)

March 31, 2023 June 30, 2022

(In thousands, except share and per share data)

September 30, 2023 June 30, 2023

Current assets:

1 unchanged sentence

Investments — short-term 41 109

Accounts receivable, net of allowance for doubtful accounts of $ 66 and $ 52 at March 31, 2023 and June 30, 2022, respectively

Accounts receivable, net of allowance for doubtful accounts of $ 117 and $ 92 at September 30, 2023 and June 30, 2023, respectively

168,660 167,787

18 unchanged sentences

Debt — long-term 1,007,257 1,041,381

Deferred tax liability — long-term 226 226

Other long-term liabilities 7,931 7,774

6 unchanged sentences

500,000,000 shares authorized:

60,441,733 and 60,420,525 issued and outstanding as of March 31, 2023 and June 30, 2022, respectively

60,447,556 and 60,441,896 issued and outstanding as of September 30, 2023 and June 30, 2023, respectively

Additional paid–in capital 5,908 4,721

Accumulated other comprehensive (loss) — ( 474 )

Retained (deficit) ( 187,926 ) ( 383,112 )

Accumulated deficit ( 69,032 ) ( 120,514 )

Total stockholders’ (deficit) ( 63,064 ) ( 115,733 )

Total liabilities and stockholders’ deficit $ 1,388,135 $ 1,406,399

See notes to consolidated financial statements (unaudited).

See accompanying notes to consolidated financial statements (unaudited).

UBIQUITI INC.

1 unchanged sentence

(In thousands, except per share amounts)

Three Months Ended March 31, Nine Months Ended March 31,

2023 2022 2023 2022

Three Months Ended September 30,

Revenues $ 463,078 $ 498,083

20 unchanged sentences

Comprehensive income $ 87,750 $ 93,133

See notes to consolidated financial statements (unaudited).

See accompanying notes to consolidated financial statements (unaudited).

UBIQUITI INC.

Consolidated Statements of Stockholders’ Equity (Deficit)

(In thousands, except per share amounts)

Three and Nine Months Ended March 31, 2023

Common Stock Additional Paid-In Capital Retained Earnings (Deficit) Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity (Deficit)

(In thousands, except share data)

Three Months Ended September 30, 2023

Common Stock Additional Paid-In Capital Retained Earnings (Deficit) Accumulated Other Comprehensive Loss Total Stockholders’ Equity (Deficit)

Shares Amount Amount Amount Amount Amount

2 unchanged sentences

Net Income — — — 87,750 — 87,750

Other comprehensive income (loss) — — — ( 49 ) ( 49 )

Stock options exercised 2,112 — 23 — — 23

Restricted stock units issued, net of tax withholdings 5,660 — ( 313 ) — — ( 313 )

Stock-based compensation expense — — 1,048 — — 1,048

Share-based compensation expense — — 1,500 — — 1,500

Dividends Paid on Common Stock ($ 0.60 per share)

2 unchanged sentences

60,447,556 $ 60 $ 5,908 $ ( 69,032 ) $ — $ ( 63,064 )

Net Income — — — 112,205 — 112,205

Reclassification adjustment for loss on investments included in net income — — — — 523 523

Restricted stock units issued, net of tax withholdings 2,147 — ( 50 ) — — ( 50 )

Stock-based compensation expense — — 1,101 — — 1,101

Dividends Paid on Common Stock ($ 0.60 per share)

— — — ( 36,257 ) — ( 36,257 )

Balances at December 31, 2022

60,430,958 $ 60 $ 2,228 $ ( 250,238 ) $ — $ ( 247,950 )

Net Income — — — 98,577 — 98,577

Restricted stock units issued, net of tax withholdings 10,775 — ( 83 ) — — ( 83 )

Stock-based compensation expense — — 1,246 — — 1,246

Dividends Paid on Common Stock ($ 0.60 per share)

— — — ( 36,265 ) — ( 36,265 )

Balances at March 31, 2023

60,441,733 $ 60 $ 3,391 $ ( 187,926 ) $ — $ ( 184,475 )

Three and Nine Months Ended March 31, 2022

Common Stock Additional Paid-In Capital Retained Earnings (Deficit) Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity (Deficit)

Three Months Ended September 30, 2022

Common Stock Additional Paid-In Capital Retained Earnings (Deficit) Accumulated Other Comprehensive Loss Total Stockholders’ Equity (Deficit)

Shares Amount Amount Amount Amount Amount

5 unchanged sentences

Restricted stock units issued, net of tax withholdings 6,174 — ( 544 ) — — ( 544 )

Repurchases of Common Stock ( 130,994 ) ( 1 ) 125 ( 39,376 ) — ( 39,252 )

Stock-based compensation expense — — 810 — — 810

Share-based compensation expense — — 1,048 — — 1,048

Dividends Paid on Common Stock ($ 0.60 per share)

2 unchanged sentences

60,428,811 $ 60 $ 1,177 $ ( 326,186 ) $ ( 523 ) $ ( 325,472 )

Net Income — — — 103,649 — 103,649

Other comprehensive income (loss) — — — — 7 7

Stock options exercised 2,584 — 36 — — 36

Restricted stock units issued, net of tax withholdings 7,947 — ( 181 ) — — ( 181 )

Repurchases of Common Stock ( 434,271 ) — ( 587 ) ( 128,457 ) — ( 129,044 )

Stock-based compensation expense — — 819 — — 819

Dividends Paid on Common Stock ($ 0.60 per share)

— $ — $ — $ ( 37,445 ) $ — $ ( 37,445 )

Balances at December 31, 2021

62,037,616 $ 62 $ 87 $ ( 4,343 ) $ 7 $ ( 4,187 )

Net Income — — — 50,354 — 50,354

Other comprehensive income (loss) — — — — ( 439 ) ( 439 )

Stock options exercised 2,112 — 23 — — 23

Restricted stock units issued, net of tax withholdings 7,225 — ( 52 ) — — ( 52 )

Repurchases of Common Stock ( 1,264,974 ) ( 1 ) ( 932 ) ( 343,777 ) — ( 344,710 )

Stock-based compensation expense — — 874 — — 874

Dividends Paid on Common Stock ($ 0.60 per share)

— — — ( 36,860 ) — ( 36,860 )

Balances at March 31, 2022

60,781,979 $ 61 $ — $ ( 334,626 ) $ ( 432 ) $ ( 334,997 )

See notes to consolidated financial statements (unaudited).

See accompanying notes to consolidated financial statements (unaudited).

UBIQUITI INC.

1 unchanged sentence

(In thousands) (Unaudited)

Nine Months Ended March 31,

Three Months Ended September 30,

Cash Flows from Operating Activities:

4 unchanged sentences

Non-cash lease expense 258 172

Premium amortization and (discount accretion), net — 35

Provision for inventory obsolescence 1,382 1,576

Provision for loss on vendor deposits and purchase commitments ( 2,419 ) 8,430

Stock-based compensation 3,394 2,503

Provisions for doubtful accounts 14 —

Provision for loss on vendor deposits 2,954 ( 2,090 )

Share-based compensation 1,500 1,048

Deferred taxes 116 135

Recovery of impaired investment — ( 902 )

Change in unrealized loss on available-for-sale securities 780 ( 407 )

Provision for sales returns ( 704 ) —

9 unchanged sentences

Accrued and other liabilities ( 3,697 ) 23,766

Net cash (used in) provided by operating activities ( 159,872 ) 300,280

Net cash provided by operating activities 67,682 41,984

Cash Flows from Investing Activities:

Purchase of property and equipment and other long-term assets ( 3,025 ) ( 8,662 )

Purchase of investments — ( 864 )

Proceeds from maturities of investments — 1,209

Net cash used in investing activities ( 3,025 ) ( 8,662 )

3 unchanged sentences

Repayment against credit facility- Term ( 9,375 ) ( 6,250 )

Repurchases of common stock — ( 513,005 )

Payment of common stock cash dividends ( 36,268 ) ( 36,256 )

1 unchanged sentence

Tax withholdings related to net share settlements of restricted stock units ( 313 ) ( 544 )

Net cash provided by (used in) financing activities 191,818 ( 394,668 )

Net cash used in financing activities ( 70,956 ) ( 33,027 )

Net increase (decrease) in cash and cash equivalents ( 6,299 ) 295

6 unchanged sentences

Right-of-use asset recognized $ 23 $ 236

Unpaid stock repurchases $ — $ 10,000

Unpaid property and equipment and other long-term assets $ 1,174 $ 421

See notes to consolidated financial statements (unaudited).

See accompanying notes to consolidated financial statements (unaudited).

UBIQUITI INC.

12 unchanged sentences

These consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the fiscal year ended June 30, 2023, included in its Annual Report on Form 10-K, as filed with the SEC on August 25, 2023 (the “Annual Report”).

The results of operations for the three and nine months ended March 31, 2023 are not necessarily indicative of the results to be expected for any future periods.

The results of operations for the three months ended September 30, 2023 are not necessarily indicative of the results to be expected for any future periods.

NOTE 2— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2 unchanged sentences

Use of Accounting Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the consolidated financial statements and the accompanying notes.

Those estimated assumptions include, but are not limited to, revenue recognition and deferred revenue;

allowance for doubtful accounts and sales return reserves;

The preparation of financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the consolidated financial statements and the accompanying notes.

Those estimates and assumptions include, but are not limited to, revenue recognition and deferred revenue;

sales return reserves;

inventory valuation and vendor deposits;

accounting for income taxes, including the valuation allowance on deferred tax assets and reserves for uncertain tax positions.

determinations of fair value for stock-based awards;

estimate of incremental borrowing rate for determining the present value of future lease payments;

and valuation of warranty accruals.

We evaluate our estimates based on historical experience and other assumptions that are believed to be reasonable under the circumstances.

We evaluate our estimates and assumptions based on historical experience and other assumptions that are believed to be reasonable under the circumstances.

Actual results could differ materially from those estimates.

9 unchanged sentences

Contract Balances

The timing of revenue recognition, billing and cash collections results in billed accounts receivable, deferred revenue primarily attributable to PCS and customer deposits on the consolidated balance sheets.

The timing of revenue recognition, billing and cash collections results in billed accounts receivable, deferred revenue primarily

attributable to PCS and customer deposits on the consolidated balance sheets.

Accounts receivable are recognized in the period our right to the consideration is unconditional.

2 unchanged sentences

The current portion of deferred revenue is included in other current liabilities and the non-current portion is included in other long-term liabilities in our consolidated balance sheets.

As of March 31, 2023 and June 30, 2022, the Company’s customer deposits were $ 0.8 million and $ 1.1 million, respectively.

As of March 31, 2023, the Company’s deferred revenue, included in other current liabilities and other long-term liabilities, was $ 17.2 million and $ 7.1 million, respectively.

As of September 30, 2023 and June 30, 2023, the Company’s customer deposits were $ 0.4 million and $ 1.2 million, respectively.

As of September 30, 2023, the Company’s deferred revenue, included in other current liabilities and other long-term liabilities, was $ 19.6 million and $ 7.9 million, respectively.

As of June 30, 2023, the Company’s deferred revenue, included in other current liabilities and other long-term liabilities, was $ 17.9 million and $ 7.8 million, respectively.

We expect the deferred revenue to convert to revenue in two years .

For the quarters ended September 30, 2023 and September 30, 2022, we recognized revenues amounting to $ 6.7 million and $ 8.6 million, respectively from previous years' deferred revenue balances.

NOTE 4— EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share for the periods indicated (in thousands, except per share data):

Three Months Ended March 31, Nine Months Ended March 31,

2023 2022 2023 2022

Three Months Ended September 30,

Net income $ 87,750 $ 93,182

10 unchanged sentences

Inventories consisted of the following (in thousands):

March 31, 2023 June 30, 2022

September 30, 2023 June 30, 2023

Finished goods $ 607,259 $ 643,499

3 unchanged sentences

Property and equipment, net consisted of the following (in thousands):

March 31, 2023 June 30, 2022

September 30, 2023 June 30, 2023

Testing equipment $ 18,199 $ 18,265

6 unchanged sentences

Property and equipment, gross 154,000 153,724

Accumulated depreciation ( 68,006 ) ( 63,816 )

Accumulated depreciation and amortization ( 69,000 ) ( 66,879 )

Property and equipment, net $ 85,000 $ 86,845

1 unchanged sentence

Other long-term assets consisted of the following (in thousands):

March 31, 2023 June 30, 2022

September 30, 2023 June 30, 2023

Hong Kong Tax deposit (1)

5 unchanged sentences

See Note 12, "Income Taxes" to the consolidated financial statements for additional details regarding this ongoing tax audit.

(2) Accumulated amortization was $ 5.5 million and $ 4.3 million as of March 31, 2023, and June 30, 2022, respectively.

(2) Accumulated amortization was $ 6.3 million and $ 5.9 million as of September 30, 2023, and June 30, 2023, respectively.

Other Current Liabilities

Other current liabilities consisted of the following (in thousands):

March 31, 2023 June 30, 2022

September 30, 2023 June 30, 2023

Deferred revenue — short-term $ 19,630 17,911

10 unchanged sentences

Other long-term liabilities consisted of the following (in thousands):

March 31, 2023 June 30, 2022

September 30, 2023 June 30, 2023

Deferred revenue — long-term $ 7,931 $ 7,774

7 unchanged sentences

Warranty obligations, included in other current liabilities, were as follows (in thousands):

Nine Months Ended March 31,

Three Months Ended September 30,

Beginning balance $ 8,745 $ 6,394

3 unchanged sentences

Ending balance $ 9,649 $ 7,159

On March 30, 2021, the Company, as borrower and certain domestic subsidiaries entered into an amended and restated credit agreement (the “Third Amended and Restated Credit Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”), the other financial institutions named as lenders therein, and Wells Fargo as administrative agent and collateral agent for the lenders, that extended the $ 700 million senior secured revolving credit facility (the “Revolving Facility”) and provided a $ 500 million senior secured term loan facility (the “Term Facility”, together with the Revolving Facility, the “Facilities”), and extended the maturity of the Facilities to March 30, 2026.

On March 30, 2021, the Company, as borrower and certain domestic subsidiaries, as guarantors (the "Domestic Guarantors"), entered into an amended and restated credit agreement (the “Third Amended and Restated Credit Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”), the other financial institutions named as lenders therein, and Wells Fargo as administrative agent and collateral agent for the lenders, that extended the $ 700 million senior secured revolving credit facility (the “Revolving Facility,” together with the Term Loan Facilities, as defined below, the "Facilities") and provided a $ 500 million senior secured term loan facility (the “Initial Term Loan Facility”), and extended the maturity of the Facilities to March 30, 2026.

In addition, the Facilities include an option to request increases in the amounts of such credit facilities by up to an additional $ 500 million in the aggregate.

The Company has $ 1.8 million of debt issuance costs which are capitalized and are being amortized as interest expense over the remaining life of the facilities.

On April 3, 2023, the Company as borrower and the Domestic Guarantors entered into a first amendment (the “First Amendment”) to the Third Amended and Restated Credit Agreement (as amended, the “Amended Credit Agreement”) with the financial institutions named as lenders therein and Wells Fargo.

The First Amendment added a new term loan facility in an aggregate principal amount of $ 250 million (the “First Amendment Term Loan Facility,” together with the Initial Term Loan Facility, the "Term Loan Facilities") which is payable in quarterly installments equal to $ 3.125 million, commencing with the quarter ended June 30, 2023, and has a maturity date of March 30, 2026.

The obligations of the Company and certain domestic subsidiaries under the Amended Credit Agreement are required to be guaranteed by the Domestic Guarantors and are collateralized by substantially all assets (excluding intellectual property) of the Company and the Domestic Guarantors.

The Company's unamortized balance of debt issuance costs are $ 2.5 million as of September 30, 2023, which are amortized as interest expense over the life of the Facilities.

The Company's debt consisted of the following (in thousands):

March 31, 2023 June 30, 2022

Term Facility - short term $ 25,000 $ 25,000

September 30, 2023 June 30, 2023

Initial Term Loan Facility - short term $ 25,000 $ 25,000

First Amendment Term Loan Facility - short-term 12,500 12,500

Debt issuance costs, net ( 992 ) ( 992 )

Total Debt - short term 36,508 36,508

Term Facility - long term 425,000 443,750

Initial Term Loan Facility - long term 412,500 418,750

First Amendment Term Loan Facility - long-term 231,250 234,375

Revolving Facility - long term 365,000 390,000

2 unchanged sentences

The Revolving Facility includes a sub-limit of $ 25.0 million for letters of credit and a sub-limit of $ 25.0 million for swingline loans.

The Facilities are available for working capital and general corporate purposes that comply with the terms of the Third Amended and Restated Credit Agreement, including to finance the repurchase of the Company’s common stock or to make dividends to the holders of the Company’s common stock.

Under the Third Amended and Restated Credit Agreement, revolving loans and swingline loans may be borrowed, repaid and reborrowed until March 30, 2026, at which time all amounts borrowed must be repaid.

The Term Facility is payable in quarterly installments of 1.25 % of the original principal amount of the Term Facility, commencing with the quarter ending June 30, 2021.

The Facilities may be prepaid at any time without penalty.

The Revolving and Term Facilities bear interest, at the Company’s option, at either (i) a floating rate per annum equal to the base rate plus a margin of between 0.50 % and 1.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter or (ii) a floating per annum rate equal to the applicable LIBOR rate (or the Secured Overnight Financing Rate ("SOFR") rate for any new or existing loans that reset after April 2, 2023) for a specified period, plus a margin of between 1.50 % and

2.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter.

Swingline loans bear interest at a floating rate per annum equal to the base rate plus a margin of between 0.50 % and 1.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter.

Base rate is defined as the greatest of (A) Wells Fargo’s prime rate, (B) the federal funds rate plus 0.50 % or (C) the applicable LIBOR rate (or SOFR rate for any new or existing loans that reset after April 2, 2023) for a period of one month plus 1.00 %.

A default interest rate shall apply on all obligations during certain events of default under the Third Amended and Restated Credit Agreement at a rate per annum equal to 2.00 % above the applicable interest rate.

The Facilities are available for working capital and general corporate purposes that comply with the terms of the Amended Credit Agreement, including to finance the repurchase of the Company’s common stock or to make dividends to the holders of the Company's common stock.

Under the Amended Credit Agreement, revolving loans and swingline loans may be borrowed, repaid and reborrowed until March 30, 2026, at which time all amounts borrowed must be repaid.

The loans under the Initial Term Loan Facility are payable in quarterly installments of $ 6.25 million per quarter, commencing with the quarter ending June 30, 2021.

Loans under the Facilities may be prepaid at any time without penalty.

The revolving loans and term loans under the Initial Term Loan Facility bear interest, at the Company’s option, at either (i) a floating rate per annum equal to the Base Rate (as defined below) plus a margin of between 0.50 % and 1.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter or (ii) a floating per annum rate equal to the Adjusted Term SOFR (as defined below) for a specified period, plus a margin of between 1.50 % and 2.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter.

Swingline loans bear interest at a floating rate per annum equal to the Base Rate plus a margin of be tween 0.50 % and 1.25 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter.

The loans under the First Amendment Term Loan Facility bear interest, at the Company's option, at either (i) a floating rate per annum equal to Base Rate plus a margin of between 1.00 % and 1.75 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter or (ii) a floating per annum rate equal to the applicable Adjusted Term SOFR rate for a specified period, plus a margin between 2.00 % and 2.75 %, depending on the Company's consolidated total leverage ratio as of the most recently ended fiscal quarter.

Base Rate is defined in the Amended Credit Agreement as the highest of (a) the Prime Rate (as defined in the Amended Credit Agreement), (b) the Federal Funds Rate (as defined in the Amended Credit Agreement) plus 0.50 % and (c) Adjusted Term SOFR for a one-month tenor in effect on such day plus 1.00 %;

each change in the Base Rate shall take effect simultaneously with the corresponding change or changes in the Prime Rate, the Federal Funds Rate or Adjusted Term SOFR, as applicable (provided that clause (c) shall not be applicable during any period in which Adjusted Term SOFR is unavailable or unascertainable).

The Base Rate shall not be less than 1.00 %.

Adjusted Term SOFR is Term SOFR (as defined in the Amended Credit Agreement) plus 0.10 % per annum;

provided that Adjusted Term SOFR shall in no event be less than 0.00 %.

A default interest rate shall apply on all obligations during certain events of default under the Amended Credit Agreement at a rate per annum equal to 2.00 % above the applicable interest rate.

The Company will pay to each lender a facility fee on a quarterly basis based on the unused amount of each lender’s commitment to make revolving loans, of between 0.20 % and 0.35 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter.

1 unchanged sentence

The Company is also obligated to pay Wells Fargo, as agent, fees customary for a credit facility of this size and type.

The Third Amended and Restated Credit Agreement requires the Company to maintain during the term of the Facilities a maximum consolidated total leverage ratio of 3.50 to 1.00 and a minimum consolidated interest coverage ratio of 3.50 to 1.00.

In addition, the Third Amended and Restated Credit Agreement contains customary affirmative and negative covenants, including covenants that limit or restrict the ability of the Company and its subsidiaries to, among other things, grant liens or enter into agreements restricting their ability to grant liens on property, enter into mergers, dispose of assets, change their accounting or reporting policies, change their business and incur indebtedness, in each case subject to customary exceptions for a credit facility of this size and type.

The Third Amended and Restated Credit Agreement includes customary events of default that include, among other things, non-payment of principal, interest or fees, inaccuracy of representations and warranties, violation of covenants, cross default to certain other indebtedness, bankruptcy and insolvency events, material judgments, change of control and certain ERISA events.

The occurrence of an event of default could result in the acceleration of the obligations under the Third Amended and Restated Credit Agreement.

The Amended Credit Agreement requires the Company to maintain during the term of the Facilities a maximum consolidated total leverage ratio of 3.50 to 1.00 and a minimum consolidated interest coverage ratio of 3.50 to 1.00.

In addition, the Amended Credit Agreement contains customary affirmative and negative covenants, including covenants that limit or restrict the ability of the Company and its subsidiaries to, among other things, grant liens or enter into agreements restricting their ability to grant liens on property, enter into mergers, dispose of assets, change their accounting or reporting policies, change their business and incur indebtedness, in each case subject to customary exceptions for a credit facility of this size and type.

The Amended Credit Agreement includes customary events of default that include, among other things, non-payment of principal, interest or fees, inaccuracy of representations and warranties, violation of covenants, cross default to certain other indebtedness, bankruptcy and insolvency events, material judgments, change of control and certain ERISA events.

The occurrence of an event of default could result in the acceleration of the obligations under the Amended Credit Agreement.

The Facilities

As of March 31, 2023, $ 450.0 million was outstanding on the Term Facility and $ 640 million was outstanding on the Revolving Facility, leaving $ 60 million available on the Revolving Facility.

Term Facility

During the nine months ended March 31, 2023, the Company made aggregate payments of $ 36.8 million under the Term Facility, of which $ 18.8 million was repayment of principal and $ 18.0 million was payment of interest.

As of March 31, 2023, the interest rate on the Term Facility was 6.59 %.

This interest rate reset on April 28, 2023.

As of September 30, 2023, $ 437.5 million was outstanding on the Initial Term Loan Facility, $ 243.8 million was outstanding on the First Amendment Term Loan Facility, and $ 365 million was outstanding on the Revolving Facility, leaving $ 335 million available on the Revolving Facility.

Term Loan Facilities

During the three months ended September 30, 2023, the Company made aggregate payments of $ 23.8 million under the Term Loan Facilities, of which $ 9.4 million was repayment of principal and $ 14.4 million was payment of interest.

Revolving Facility

Under the Third Amended and Restated Credit Agreement, during the nine months ended March 31, 2023, the Company made aggregate payments of $ 76.3 million under the Revolving Facility, of which $ 60 million was repayment of principal and $ 16.3 million was payment of interest.

As of March 31, 2023, the interest rates on the Revolving Facility were 6.46 % - 6.53 %.

The following table summarizes the Company’s estimated debt and interest payment obligations as of March 31, 2023, for the remainder of fiscal 2023 and future fiscal years (in thousands):

Under the Amended Credit Agreement, during the three months ended September 30, 2023, the Company made aggregate payments

of $ 32.3 million under the Revolving Facility, of which $ 25 million was repayment of principal and $ 7.3 million was payment of interest.

The following table summarizes the Company’s estimated debt and interest payment obligations as of September 30, 2023, for the remainder of fiscal 2024 and future fiscal years (in thousands):

2024 (remainder)

4 unchanged sentences

Total $ 85,317 $ 111,305 $ 1,034,046 $ — $ — $ — $ 1,230,668

(1) Interest payments are calculated based on the applicable rates and payment dates as of March 31, 2023 and assumes the outstanding revolver balance remains at $ 640 million.

Although the Company’s interest rates on debt obligations may vary, the Company has assumed the most recent available interest rates for all periods presented.

The Facilities were amended on April 3, 2023.

For additional information regarding the Facilities, refer to Note 14 - Subsequent Events.

(1) Interest payments are calculated based on the applicable rates and payment dates as of September 30, 2023.

Although our interest rates on our debt obligations may vary, we have assumed the most recent available interest rates for all periods presented.

NOTE 8— LEASES

The Company enters into agreements under which we lease various real estate spaces in North America, Europe and Asia Pacific, under non-cancellable leases that expire on various dates through fiscal 2036.

The Company has entered into agreements under which we lease various real estate spaces in North America, Europe and Asia Pacific, under non-cancellable leases that expire on various dates through fiscal 2036.

Some of our leases include options to extend the term of such leases for a period from 12 months to 60 months, and/or have options to early terminate the lease.

As of March 31, 2023, we included such options in determining the lease terms for certain of our leases because we were reasonably certain that we would exercise the extension options.

As of September 30, 2023, we included such options in determining the lease terms for certain of our leases because we were reasonably certain that we would exercise the extension options.

Most of our leases require us to pay certain operating expenses in addition to base rent, such as taxes, insurance and maintenance costs.

The following table summarizes our lease costs for the three and nine months ended March 31, 2023 and 2022 (in thousands):

Financial Statement Classification Three Months Ended March 31, Nine Months Ended March 31,

2023 2022 2023 2022

The following table summarizes our lease costs for the three months ended September 30, 2023 and 2022 (in thousands):

Financial Statement Classification Three Months Ended September 30,

Operating lease costs:

5 unchanged sentences

The operating lease costs in the table above include costs for long-term and short-term leases.

Total short-term costs for the three and nine months ended March 31, 2023, were $ 0.2 million and $ 0.4 million, respectively.

Total short-term costs for the three and nine months ended March 31, 2022, were $ 0.2 million and $ 0.4 million, respectively.

Total short-term costs for the three months ended September 30, 2023 and 2022, were $ 0.2 million, respectively.

Variable lease costs primarily include maintenance, utilities and operating expenses that are incremental to the fixed base rent payments and are excluded from the calculation of operating lease liabilities and ROU assets.

For the three months ended March 31, 2023 and 2022, cash paid for amounts associated with the Company's operating lease liabilities were approximately $ 3.8 million and $ 3.8 million, respectively.

For the nine months ended March 31, 2023 and 2022, cash paid for amounts associated with the Company’s operating lease liabilities were approximately $ 11.4 million and $ 10.2 million, respectively.

For the three months ended September 30, 2023 and 2022, cash paid for amounts associated with the Company's operating lease liabilities were approximately $ 4.3 million and $ 3.6 million, respectively.

Cash paid for amounts associated with the Company’s operating lease liabilities were classified as operating activities in the consolidated statement of cash flows.

The following table shows the Company’s undiscounted future fixed payment obligations under the Company’s recognized operating leases and a reconciliation to the operating lease liabilities as of March 31, 2023:

Remainder of Fiscal 2024

7 unchanged sentences

Operating Leases

See Note 8, "Leases" for future minimum lease payments under non-cancelable operating leases as of March 31, 2023.

See Note 8, "Leases" for future minimum lease payments under non-cancelable operating leases as of September 30, 2023.

Purchase Obligations

We subcontract with third parties to manufacture our products and have purchase commitments with key component suppliers.

the normal course of business, the Company’s contract manufacturers procure components and manufacture products based upon orders placed by us.

We subcontract with third parties to manufacture our products and supply key components.

As of September 30, 2023, we had $ 1,081.4 million of purchase commitments with these third parties.

If we cancel all or part of the orders, we may still be liable to the contract manufacturers for the cost of the components purchased by the subcontractors to manufacture our products.

We periodically review the potential liability.

There have been no significant liabilities for cancellations recorded as of March 31, 2023.

Our consolidated financial position and results of operations could be negatively impacted if we were required to compensate the contract manufacturers for any unrecorded liabilities incurred.

We may be subject to additional purchase obligations for supply agreements and components ordered by our contract manufacturers based on manufacturing forecasts we provide them each month.

We estimate the amount of these additional purchase obligations to range from $ 1,279.2 million to $ 1,390.5 million as of March 31, 2023, depending upon the timing of orders placed for these components by our contract manufacturers.

There have been no significant liabilities for current or anticipated cancellations recorded as of September 30, 2023.

Our consolidated financial position and results of operations could be negatively impacted if we were required to compensate these third parties.

In addition, we may be subject to additional purchase obligations to our contract manufacturers for supply agreements and components ordered by them based on manufacturing forecasts we provide them each month.

Transition Tax

We have obligations of $ 50.6 million as of September 30, 2023, related to the mandatory transition tax on accumulated foreign earnings from the 2017 Tax Cuts and Jobs Act.

Payment of these obligations are expected to be $ 22.5 million for fiscal 2025 and $ 28.1 million for fiscal 2026.

These obligations are included within Income tax payable and Long-term taxes payable on our consolidated balance sheets.

Other Obligations

As of March 31, 2023, the Company has other obligations of $ 5.8 million which consisted primarily of commitments related to research and development projects.

As of September 30, 2023, the Company has other obligations of $ 5.4 million which consisted primarily of commitments related to research and development projects.

Indemnification Obligations

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The PTO invalidated asserted claims of two of the three Patents-in-Suit.

The District Court lifted the stay on March 1, 2021 to resume proceedings on the ’ 231 Patent in the Original Action.

On June 16, 2021, Vivato filed a new suit against the Company in the Central District of California, alleging that various Company products infringe some of the non-invalidated claims of the ’728 Patent and U.S.

10,594,376 (the “New Action”).

The New Action, as well as four similar new lawsuits filed by Vivato against other defendants in the same jurisdiction, were consolidated into the Original Action.

On November 24, 2021, the Company and the remaining defendants in the Original Action filed a motion for judgment on the pleadings regarding the '231 Patent.

On January 4, 2022, the Court granted defendants’ motion and dismissed Vivato’s claims based on the '231 Patent.

The Federal Circuit Court of Appeals affirmed the invalidity of the '231 Patent on May 18, 2023.

That ruling is now on appeal.

All claims asserted against the Company in the Original Action have been dismissed.

On April 18, 2022, the court granted in part the motion for judgment on the pleadings with respect to the ’728 patent, dismissing one of the four remaining claims.

On July 28, 2022, Vivato voluntarily dismissed, with prejudice, its remaining claims related to the '728 patent, as well as claims 22-31 of the '376 Patent.

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On October 26, 2022, the court stayed the case pending completion of the IPR.

On October 3, 2023, the IPR with respect to the '376 Patent was terminated after the petitioners entered into a settlement agreement with Vivato.

The district court action presently remains stayed.

The Company plans to vigorously defend itself against these claims;

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The Company cannot currently estimate the possible loss or range of losses, if any, that it may experience in connection with this litigation.

Network-1 Technologies, Inc.

On October 5, 2022, Network-1 Technologies, Inc.

("Network-1") filed a patent infringement lawsuit against the Company in the District of Delaware, alleging that various Company products infringe United States Patent Number 6,218,930, which relates to 802.3af and 802.3at “ Power over Ethernet ” standards.

Network-1 seeks compensatory and enhanced damages, attorneys' fees and costs, and pre- and post-judgment interest.

The Company plans to vigorously defend itself against these claims;

however, there can be no assurance that the Company will prevail in the lawsuit.

The Company cannot currently estimate the possible loss or range of losses, if any, that it may experience in connection with this litigation.

Intellectual Ventures I LLC v.

Ubiquiti Inc.

On August 8, 2023, Intellectual Ventures I LLC ("IV") filed a patent infringement lawsuit against the Company in the District of Delaware, alleging that various Company products infringe United States Patent Number 8,594,122, which relates to 802.11ac “ Beamforming ” standards.

IV seeks compensatory and enhanced damages, attorneys' fees and costs, and pre- and post-judgment interest.The Company plans to vigorously defend itself against these claims;

however, there can be no assurance that the Company will prevail in the lawsuit.

The Company cannot currently estimate the possible loss or range of losses, if any, that it may experience in connection with this litigation.

NOTE 10— COMMON STOCK AND TREASURY STOCK

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On May 3, 2022, the Board of Directors of the Company approved a $ 200 million stock repurchase program (the “2022 May Program”).

Under the 2022 May Program, the Company is authorized to repurchase up to $ 200 million of common stock.

The 2022 May Program expires on September 30, 2023.

The Company did not make any repurchases under the 2022 May Program during the three and nine months ended March 31, 2023.

As of March 31, 2023, the Company had $ 200 million available for share purchase under the 2022 May Program.

NOTE 11— STOCK BASED COMPENSATION

Stock-Based Compensation Plans

Under the 2022 May Program, the Company was authorized to repurchase up to $ 200 million of common stock.

The 2022 May Program expired on September 30, 2023, and the Company did not make any repurchases under the 2022 May Program.

NOTE 11— SHARE-BASED COMPENSATION

Share-Based Compensation Plans

The Company’s 2020 and 2010 Equity Incentive Plans are described in the Company’s Annual Report.

As of March 31, 2023, the Company had 4,939,274 authorized shares available for future issuance under all of its stock incentive plans.

Stock-Based Compensation

The following table shows total stock-based compensation expense included in the consolidated statements of operations and comprehensive income for the three and nine months ended March 31, 2023 and 2022 (in thousands):

Three Months Ended March 31, Nine Months Ended March 31,

2023 2022 2023 2022

As of September 30, 2023, the Company had 4,920,774 authorized shares available for future issuance under all of its stock incentive plans.

Share-Based Compensation

The following table shows total share-based compensation expense included in the consolidated statements of operations and comprehensive income for the three months ended September 30, 2023 and 2022 (in thousands):

Three Months Ended September 30,

Cost of revenues $ 33 $ 11

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Sales, general and administrative 332 268

1,246 874 $ 3,394 $ 2,503

Stock Options

The following is a summary of option activity for the Company’s stock incentive plans for the nine months ended March 31, 2023:

Common Stock Options Outstanding

of Shares Weighted

Price Weighted

Life (Years) Aggregate

(In thousands)

Balance, June 30, 2022

2,112 $ 10.77 0.37 $ 584,982

Exercised ( 2,112 ) $ 10.77

Forfeitures and cancellations

Balance, March 31, 2023

Vested as of March 31, 2023

Vested and exercisable as of March 31, 2023

During the three months ended March 31, 2023 and 2022, the aggregate intrinsic value of options exercised under the Company’s stock incentive plans was $ 0.0 million and $ 0.5 million, respectively, as determined as of the date of option exercise.

During the nine months ended March 31, 2023 and 2022, the aggregate intrinsic value of options exercised under the Company’s stock incentive plans was $ 0.6 million and $ 1.8 million, respectively, as determined as of the date of option exercise.

As of March 31, 2023, the Company had no unrecognized compensation costs related to stock options.

The Company did no t grant any employee stock options during the three and nine months ended March 31, 2023, and 2022.

During the three months ended September 30, 2023 and 2022, the aggregate intrinsic value of options exercised under the Company’s stock incentive plans was $ 0.0 million and $ 0.6 million, respectively, as determined as of the date of option exercise.

As of September 30, 2023, the Company had no unrecognized compensation costs related to stock options, and the Company did no t grant any employee stock options during the three months ended September 30, 2023, and 2022.

Restricted Stock Units (“RSUs”)

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RSUs canceled — $ —

Non-vested RSUs, March 31, 2023

Non-vested RSUs, September 30, 2023

73,182 $ 244.73

The intrinsic value of RSUs vested in the three months ended March 31, 2023 and 2022 was $ 3.1 million and $ 2.2 million, respectively.

The intrinsic value of RSUs vested in the nine months ended March 31, 2023 and 2022 was $ 5.8 million and $ 8.2 million, respectively.

The total intrinsic value of all outstanding RSUs was $ 16.7 million as of March 31, 2023.

As of March 31, 2023, there were unrecognized compensation costs related to RSUs of $ 12.3 million which the Company expects to recognize over a weighted average period of 3.5 years.

The intrinsic value of RSUs vested in the three months ended September 30, 2023 and 2022 was $ 1.3 million and $ 2.1 million, respectively.

The total intrinsic value of all outstanding RSUs was $ 10.6 million as of September 30, 2023.

As of September 30, 2023, there were unrecognized compensation costs related to RSUs of $ 12.8 million which the Company expects

to recognize over a weighted average period of 3.3 years.

NOTE 12— INCOME TAXES

The Company recorded tax provisions of $ 18.5 million and $ 58.3 million for the three and nine months ended March 31, 2023 as compared to $ 9.0 million and $ 53.8 million for the three and nine months ended March 31, 2022.

The increased provision for the three months ended March 31, 2023 is primarily related to the overall increase in income before income taxes for the period as compared to the three months ended March 31, 2022.

The increase to the tax provision for the nine months ended March 31, 2023 is attributable to the overall increase in income before income taxes for the period as well as an increase in taxable income in higher tax jurisdictions as compared to the prior year.

The Company recorded tax provisions of $ 19.3 million for the three months ended September 30, 2023 as compared to $ 18.2 million for the three months ended September 30, 2022.

The increased provision for the three months ended September 30, 2023 was primarily related to the increase in estimated effective tax rate due to changes in the mix of the income earned in various tax jurisdictions partially offset by a decrease in the Global Intangible Low-Taxed Income ("GILTI") inclusion for the U.S.

taxable income for the three months ended September 30, 2023 as compared to the three months ended September 30, 2022, as well as a release of a reserve for unrecognized tax benefit due to statute of limitation during the three months ended September 30, 2022.

The Company’s estimated fiscal year 2024 effective tax rate, before discrete items, differs from the U.S.

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tax related to our non-U.S.

operations under Global Intangible Low-Taxed Income ("GILTI") rules.

As of March 31, 2023, the Company had approximately $ 34.9 million of unrecognized tax benefits, substantially all of which would, if recognized, affect its tax expense.

During the three months ended March 31, 2023, the Company recorded an increase of its unrecognized tax benefits of $ 1.3 million.

operations under GILTI rules.

As of September 30, 2023, the Company had approximately $ 33.4 million of unrecognized tax benefits, substantially all of which would, if recognized, affect its tax expense.

During the three months ended September 30, 2023, the Company recorded an increase of its unrecognized tax benefits of $ 1.0 million for the quarter ended September 30, 2023.

The Company did not release any unrecognized tax benefits for the quarter ended September 30, 2023.

The Company recognizes interest and penalties related to unrecognized tax benefits within the income tax expense line in the accompanying consolidated statement of operations and comprehensive income.

Accrued interest and penalties are included within the related tax liability line in the consolidated balance sheets.

As of March 31, 2023, the Company had $ 3.5 million accrued interest related to uncertain tax matters.

As of September 30, 2023, the Company had $ 3.6 million accrued interest related to uncertain tax matters.

The Company and one or more of its subsidiaries, file income tax returns in the United States federal jurisdiction, and various state, local, and foreign jurisdictions and is currently undergoing income tax examinations by the U.S.

Internal Revenue Service and the Hong Kong Inland Revenue Department (“IRD”).

Internal Revenue Service ("IRS") and the Hong Kong IRD.

All material consolidated federal, state and local income tax matters have been concluded for years through 2014.

The majority of the Company's foreign jurisdictions have been concluded through 2014, with the exception of Hong Kong which has been reviewed through 2009 and is currently under audit for the 2010-2017 tax years.

During fiscal years 2022, 2021, 2020, 2019, and 2018, the Company made a total of $ 3.0 million, $ 21.9 million, $ 15.5 million, $ 13.4 million, and $ 6.6 million of deposits with the Hong Kong IRD in connection with extending the statute of limitation for income tax examinations currently under audit for 2010-2016 tax years.

On March 30, 2023, the Company received notification that the Hong Kong IRD is seeking an additional $ 0.3 million deposit covering the 2017 tax year.

The Company has filed a formal protest in response to this notice and is awaiting a response from the Assessor's office.

The Company does not expect the deposit, with respect to the 2017 tax year, to be material in nature.

The refundable deposits are included within other long-term assets on our consolidated balance sheets.

The IRD is examining the Company’s claims that its revenue is generated through activities performed wholly outside of the Hong Kong tax jurisdiction and are therefore exempt from Hong Kong tax.

The Company is fully cooperating with the examination including submitting documentation in support of its position.

The Company continues to believe that its tax positions filed with IRD are more likely than not to be sustained based on their technical merits and therefore no reserve has been provided for this tax uncertainty and we expect the $ 60.0 million (net of foreign currency impact) of deposits made with IRD to be refunded upon completion of the audit.

However, there can be no assurance that this matter will be resolved in the Company’s favor and therefore it's possible that an adverse outcome of the matter could have a material effect on the Company’s results of operations and financial condition.

In July 2018, the Company received a draft Notice of Proposed Adjustment (“Draft NOPA”) from the Internal Revenue Service (“IRS”) proposing an adjustment to income for the fiscal 2015 and fiscal 2016 tax years based on its interpretation of certain obligations of the non-US entities under the credit facility.

In July 2018, the Company received a draft Notice of Proposed Adjustment (“Draft NOPA”) from the IRS proposing an adjustment to income for the fiscal 2015 and fiscal 2016 tax years based on its interpretation of certain obligations of the non-US entities under the 2015 and 2016 credit facility.

This Draft NOPA was superseded by an Acknowledgement of Facts (“AOF”) issued to the Company by the IRS on January 17, 2020.

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Regardless of whether the matter is resolved in the Company’s favor, the final resolution of this matter could be expensive and time-consuming to defend and/or settle.

We estimate the incremental tax liability associated with the income adjustment proposed in the AOF would be approximately $ 50.0 million, excluding potential interest and penalties, after adjusting for the impact of an adjustment on the amount of transition tax payable in future years by the Company.

As the Company believes that the tax originally paid in fiscal 2015 and fiscal 2016 is correct, it has not provided a reserve for this tax uncertainty.

We estimate the incremental tax liability associated with the income adjustment proposed in the AOF would be approximately $ 50.0 million, excluding potential interest and penalties, after adjusting for the impact of an adjustment on the amount of the transition tax on accumulated foreign earnings from the 2017 Tax Cuts and Jobs Act.

As the Company believes that the tax originally paid in fiscal 2015 and fiscal 2016 is correct and that this matter will more likely than not be sustained based on its technical merits, it has not provided a reserve for this tax uncertainty.

However, an adverse outcome may have a material and adverse effect on the Company’s results of operations and financial condition.

During fiscal years 2022, 2021, 2020, 2019, and 2018, the Company made a total of $ 3.0 million, $ 21.9 million, $ 15.5 million, $ 13.4 million, and $ 6.6 million, respectively, of deposits with the Hong Kong IRD in connection with extending the statute of limitation for income tax examinations currently under audit for 2010-2016 tax years.

On March 30, 2023, the Company received notification that the Hong Kong IRD is seeking an additional $ 0.3 million deposit covering the 2017 tax year.

The Company filed a formal protest in response to this notice and the Assessor's office agreed to a reduced deposit of under $ 0.1 million, which was remitted on May 18, 2023.

The refundable deposits are included within other long-term assets on our Consolidated Balance Sheets.

The IRD is examining the Company’s claims that its revenue is generated through activities performed wholly outside of the Hong Kong tax jurisdiction and are therefore exempt from Hong Kong tax.

The Company is fully cooperating with the examination including submitting documentation in support of its position.

The Company continues to believe that its tax positions filed with IRD are more likely than not to be sustained based on their technical merits and therefore no reserve has been provided for this tax uncertainty and we expect the $ 60.1 million (net of foreign currency impact) of deposits made with IRD to be refunded upon completion of the audit.

there can be no assurance that this matter will be resolved in the Company’s favor and therefore it's possible that an adverse outcome of the matter could have a material effect on the Company’s results of operations and financial condition.

NOTE 13— SEGMENT INFORMATION, REVENUES BY GEOGRAPHY AND SIGNIFICANT CUSTOMERS

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Revenues by product type are as follows (in thousands, except percentages):

Three Months Ended March 31, Nine Months Ended March 31,

2023 2022 2023 2022

Three Months Ended September 30,

Enterprise technology $ 380,095 82 % $ 426,298 86 %

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Revenues by geography based on customer’s ship-to destinations were as follows (in thousands, except percentages):

Three Months Ended March 31, Nine Months Ended March 31,

2023 2022 2023 2022

Three Months Ended September 30,

North America (1)

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Total revenues $ 463,078 100 % $ 498,083 100 %

(1) Revenue for the United States was $ 214.3 million and $ 173.9 million for the three months ended March 31, 2023 and 2022, respectively.

Revenue for the United States was $ 634.0 million and $ 536.8 million for the nine months ended March 31, 2023 and 2022 , respectively.

For the periods presented, there were no customers with net revenues of 10% or greater of total revenues.

Customers with an accounts receivable balance of 10% or greater of total accounts receivable are presented below for the periods indicated:

Percentage of Accounts Receivable

March 31, June 30,

Customer A 12 % *

* denotes less than 10%

(1) Revenue for the United States was $ 209.2 million and $ 210.3 million for the three months ended September 30, 2023 and 2022, respectively.

For the periods presented, there were no customers with an accounts receivable balance of 10% or greater of total accounts receivable or customers with net revenues of 10% or greater of total revenues.

NOTE 14— SUBSEQUENT EVENTS

First Amendment to Third Amended & Restated Credit Agreement

On April 3, 2023, the Company as borrower and certain domestic subsidiaries, as guarantors (the “Domestic Guarantors”) entered into a first amendment (the “First Amendment”) to the Third Amended and Restated Credit Agreement (as amended, the “Amended Credit Agreement”) with the financial institutions named as lenders therein and Wells Fargo.

The First Amendment added a new term loan facility in an aggregate principal amount of $ 250.0 million (the “First Amendment Term Loan”) which is payable in quarterly installments equal to $ 3.125 million, commencing with the quarter ended June 30, 2023, and has a maturity date of March 30, 2026.

The First Amendment Term Loan bears interest, at the Company’s option, at either (i) a floating rate per annum equal to Base Rate plus a margin of between 1.00 % and 1.75 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter or (ii) a floating per annum rate equal to the applicable Adjusted Term SOFR rate for a specified period, plus a margin of between 2.00 % and 2.75 %, depending on the Company’s consolidated total leverage ratio as of the most recently ended fiscal quarter.

The obligations of the Company and certain domestic subsidiaries under the First Amendment Term Loan are required to be guaranteed by the Domestic Guarantors and are collateralized by substantially all assets (excluding intellectual property) of the Company and the Domestic Guarantors.

The First Amendment also (a) provided that all loans bearing interest at a LIBOR rate under the Amended Credit Agreement (each, a “LIBOR Rate Loan”) and the applicable interest periods in respect of such LIBOR Rate Loans under the Amended Credit Agreement will not be renewed or extended and, upon the expiration or earlier termination of such interest periods, such LIBOR Rate Loans will be (i) repaid or (ii) converted to loans accruing at Base Rate (as defined in the Amended Credit Agreement) or Adjusted Term SOFR (as defined below), at the Company’s option;

(b) implemented “Adjusted Term SOFR” as a reference rate for borrowings under the Amended Credit Agreement, and (c) modified the definition of “Base Rate” to replace the LIBOR rate component with Adjusted Term SOFR.

Base Rate is defined as the highest of (a) the Prime Rate, (b) the Federal Funds Rate plus 0.50 % and (c) Adjusted Term SOFR for a one-month tenor in effect on such day plus 1 %;

each change in the Base Rate shall take effect simultaneously with the corresponding change or changes in the Prime Rate, the Federal Funds Rate or Adjusted Term SOFR, as applicable ( provided that clause (c) shall not be applicable during any period in which Adjusted Term SOFR is unavailable or unascertainable).

The Base Rate shall not be less than 1.00 %.

Adjusted Term SOFR is Term SOFR (as defined in the Amended Credit Agreement) plus 0.10 % per annum;

provided that Adjusted Term SOFR shall in no event be less than 0.00 %.

On May 5, 2023, the Company's Board of Directors had approved a quarterly cash dividend of $ 0.60 per share payable on May 22, 2023 to shareholders of record at the close of business on May 15, 2023.

On November 2, 2023, the Company's Board of Directors approved a quarterly cash dividend of $ 0.60 per share payable on November 20, 2023 to shareholders of record at the close of business on November 13, 2023.

Any future dividends will be subject to the approval of the Company’s Board of Directors.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements