What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2024-02-29 compared with 2023-03-01 · 138 added, 150 removed, 1354 unchanged (18% of the section changed)

24 unchanged sentences

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control-Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2022, of the Company and our report dated March 1, 2023, expressed an unqualified opinion on those financial statements.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2023, of the Company and our report dated February 29, 2024, expressed an unqualified opinion on those financial statements.

Basis for Opinion

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Brightman Almagor Zohar & Co.

Certified Public Accountants

A Firm in the Deloitte Global Network

Tel Aviv, Israel

March 1, 2023

February 29, 2024

OTHER INFORMATION

During the fiscal quarter ended December 31, 2023, none of the Company’s directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended) adopted or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K of the Securities Act of 1933, as amended).

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.

DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

Certain information required under this Item with respect to our Executive Officers is contained under the heading “Executive Officers” in Item 1 hereof.

Certain information required under this Item with respect to our Executive Officers is contained under the heading “Information about our Executive Officers” in Item 1 hereof.

Other information required under this Item will be contained under the heading “Nominees for Election as Directors” in our definitive proxy statement for the Company’s 2024 Annual Meeting of Stockholders, which will be filed within 120 days of December 31, 2023, our most recent fiscal year end, and is incorporated herein by reference.

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1 to Amended and Restated Certificate of Incorporation of Vishay Precision Group, Inc., effective June 2, 2011 (previously filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the SEC on June 6, 2011 and incorporated herein by reference).

3.3 Second Amended and Restated Bylaws of Vishay Precision Group, Inc., adopted as of June 2, 2011 (previously filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the SEC on June 6, 2011 and incorporated herein by reference).

3.3 Third Amended and Restated Bylaws of Vishay Precision Group, Inc., adopted March 30, 2023 (previously filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the SEC on March 31, 2023 and incorporated herein by reference).

4.1 Description of Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (previously filed as an exhibit to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 11, 2020 and incorporated herein by reference).

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(previously filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the SEC on July 7, 2010 and incorporated herein by reference).

10.8* Lease Agreement, dated July 4, 2010, between Vishay Advanced Technology, Ltd.

(previously filed as an exhibit to the Registrant's Current Report on Form 8-K filed with the SEC on July 7, 2010 and incorporated herein by reference).

10.8* Supply Agreement, dated July 6, 2010, between Vishay Measurements Group, Inc.

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10.23† Form of Performance Restricted Stock Unit Award Agreement for Employee Grants (previously filed as an exhibit to the Registrant’s Current Report on Form 10-K filed with the SEC on March 12, 2013 and incorporated herein by reference).

10.25 Lease Agreement, between George Kelk Corporation and Anndale Properties Limited (and its successors), dated January 30, 1996 and as amended as of January 17, 2011 (previously filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with SEC on May 8, 2013 and incorporated herein by reference).

10.25† Vishay Precision Group, Inc.

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and William Clancy (previously filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the SEC on November 12, 2013 and incorporated herein by reference).

10.29 Lease agreement, dated January 26, 2014, by and among between Vishay Advanced Technologies, Inc.

and Tefen Enterprises Ltd.

(previously filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on May 7, 2014 and incorporated herein by reference).

10.30 Stock Purchase Agreement, dated December 14, 2015, by and among VPG Systems U.S., Inc., Stress-Tek, Inc., the shareholders of Stress-Tek, Inc., and Keith Reichow, as Representative (previously filed as an exhibit to the Registrant’s Current Report on Form 8-K filed with the SEC on December 15, 2015 and incorporated herein by reference).

10.28 Third Amended and Restated Credit Agreement, dated March 20, 2020, by and among Vishay Precision Group, Inc., the lenders party thereto, Citizens Bank, National Association, Wells Fargo Bank, National Association, and JPMorgan Chase Bank, National Association (previously filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on March 23, 2020 and incorporated herein by reference).

10.32 Stock Purchase Agreement, dated March 30, 2016, by and among Vishay Precision Group, Inc., Pacific Instruments, Inc., the shareholders of Pacific Instruments, Inc., John Hueckel and Norman Hueckel as Owners, and John Hueckel, as Representative (previously filed as an exhibit to the Registrant's Current Report on Form 8-K filed with the SEC on April 5, 2016 and incorporated herein by reference).

10.29 Amendment No.

1 to Third Amended and Restated Credit Agreement, dated May 5, 2023, by and among Vishay Precision Group, Inc., the lenders party thereto, Citizens Bank, National Association, Wells Fargo Bank, National Association, and JPMorgan Chase Bank, National Association (previously filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on May 9, 2023 and incorporated herein by reference).

10.30† Form of Indemnification Agreement with directors (previously filed as an exhibit to the Registrant's Quarterly Report on Form 10-Q filed with the SEC on May 11, 2016 and incorporated herein by reference).

1 unchanged sentence

and Amir Tal (previously filed as an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on May 5, 2020 and incorporated herein by reference).

10.35 Lease agreement, dated July 7, 2016, by and among between Vishay Advanced Technologies, Ltd.

and Marshee Estates & Investments Ltd.

(previously filed as an exhibit to the Registrant's Current Report on Form 10-K filed with the SEC on March 16, 2016 and incorporated herein by reference).

10.32† Amendment to Employment Agreement, dated May 8, 2017, by and among Vishay Precision Group, Inc.

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Clancy, Chief Financial Officer.

97.1 Vishay Precision Group, Inc.

Dodd-Frank Clawback Policy, effective October 2, 2023.

101 Interactive Data File (Annual Report on Form 10-K, for the year ended December 31, 2023, furnished in XBRL (eXtensible Business Reporting Language)).

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/s/ Ziv Shoshani

March 1, 2023

February 29, 2024

President and Chief Executive Officer

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Signature Title Date

/s/ Ziv Shoshani Chief Executive Officer and Director March 1, 2023

/s/ Ziv Shoshani Chief Executive Officer and Director February 29, 2024

Ziv Shoshani (Principal Executive Officer)

/s/ William M.

Clancy Executive Vice President & Chief Financial Officer March 1, 2023

Clancy Executive Vice President & Chief Financial Officer February 29, 2024

Clancy (Principal Financial and Accounting Officer)

Reibstein Director March 1, 2023

/s/ Marc Zandman Director March 1, 2023

Reibstein Director February 29, 2024

/s/ Marc Zandman Director February 29, 2024

/s/ Timothy V.

Talbert Director March 1, 2023

/s/ Janet Clarke Director March 1, 2023

/s/ Bruce Lerner Director March 1, 2023

/s/ Wesley Cummins Director March 1, 2023

Talbert Director February 29, 2024

/s/ Janet Clarke Director February 29, 2024

/s/ Bruce Lerner Director February 29, 2024

/s/ Wesley Cummins Director February 29, 2024

Wesley Cummins

/s/ Sejal Shah Gulati

Director March 1, 2023

Director February 29, 2024

Sejal Shah Gulati

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In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

We have also 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, 2022, based on criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated March 1, 2023, expressed an unqualified opinion on the Company's internal control over financial reporting.

We have also 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, 2022, 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 29, 2024, expressed an unqualified opinion on the Company's internal control over financial reporting.

Basis for Opinion

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Changes in these estimates and assumptions could have a significant impact on the fair value of the reporting unit.

The carrying amount of goodwill as of December 31, 2022, for the DSI reporting unit is $16.9 million.

The fair value of the DSI reporting unit exceeds the carrying value by approximately 8%.

We identified goodwill for the DSI reporting unit as a critical audit matter because of the significant judgments made by management to estimate fair value and the sensitivity to changes in management estimates and assumptions.

The carrying value of goodwill as of December 31, 2023, for the DSI reporting unit is $16.9 million.

The fair value of the DSI reporting unit exceeds the carrying value, therefore, no impairment was recognized.

We identified goodwill for the DSI reporting unit as a critical audit matter because of the significant judgments made by management to estimate the fair value of the reporting unit and the difference between the fair value and carrying value.

This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists, when performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to forecasts of future revenues, profitability, working capital requirements and selection of the discount and long term growth rates.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to forecasts of future revenues, profitability, working capital requirements and selection of discount and long term growth rate used by management to estimate the fair value of the DSI reporting unit included the following, among others:

Our audit procedures related to forecasts of future revenues, profitability, working capital requirements and selection of discount and long term growth rates used by management to estimate the fair value of the DSI reporting unit included the following, among others:

• We tested the effectiveness of controls over management’s impairment evaluation, including those over the determination of the fair value of the DSI reporting unit, such as controls related to management’s forecasts of future revenues, profitability, working capital requirements and selection of discount and long term growth rates.

6 unchanged sentences

Brightman Almagor Zohar & Co.

Certified Public Accountants

A Firm in the Deloitte Global Network

Tel Aviv, Israel

March 1, 2023

February 29, 2024

We have served as the Company’s auditor since 2019.

67 unchanged sentences

329,925 306,522

306,522 277,042

Total liabilities and equity

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Depreciation and amortization 15,550 15,353 14,996

Loss from extinguishment of debt — — 30

Gain on disposal of property and equipment ( 117 ) ( 5 ) ( 130 )

Loss (gain) on disposal of property and equipment 75 ( 117 ) ( 5 )

Gain on sale of short term investment ( 14 ) — —

Reclassification of foreign currency translation adjustment related to disposal of subsidiary — 191 —

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Proceeds from sale of property and equipment 40 451 231

Purchase of short term investment ( 1,000 ) — —

Proceeds from sale of short term investment 1,014 — —

Purchase of business — — ( 47,216 )

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Principal payments on long-term debt — — ( 18 )

Debt issuance costs — — ( 402 )

Proceeds from revolving facility — — 20,000

Payments on revolving facility ( 29,000 ) — —

Purchase of treasury stock ( 5,915 ) ( 2,739 ) —

Purchase of non-controlling interest — — ( 253 )

Distributions to noncontrolling interests ( 195 ) ( 457 ) ( 313 )

2 unchanged sentences

Effect of exchange rate changes on cash and cash equivalents 545 ( 4,334 ) ( 2,410 )

Increase (decrease) in cash and cash equivalents 4,227 ( 14,103 ) 11,528

(Decrease) increase in cash and cash equivalents ( 4,597 ) 4,227 ( 14,103 )

Cash and cash equivalents at beginning of year 88,562 84,335 98,438

1 unchanged sentence

Supplemental disclosure of investing transactions:

Capital expenditures purchased $ ( 19,951 ) $ ( 17,567 ) $ ( 24,327 )

Capital expenditures accrued but not yet paid $ 2,317 $ 1,731 $ 3,068

Supplemental disclosure of financing transactions:

Excise tax on net share repurchases accrued but not yet paid $ 41 $ — $ —

See accompanying notes.

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5 — — ( 857 ) — — ( 852 ) — ( 852 )

Purchase of noncontrolling interest — — — 48 — — 48 ( 301 ) ( 253 )

Distributions to noncontrolling interests

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Balance at December 31, 2021 $ 1,322 $ 103 $ ( 8,765 ) $ 199,151 $ 120,296 $ ( 35,008 ) $ 277,099 $ ( 57 ) $ 277,042

— — — — 20,221 — 20,221 222 20,443

Other comprehensive income

— — — — — ( 2,337 ) ( 2,337 ) — ( 2,337 )

Net earnings — — — — 36,063 — 36,063 490 36,553

Other comprehensive loss — — — — — ( 5,892 ) ( 5,892 ) — ( 5,892 )

Share-based compensation expense — — — 2,439 — — 2,439 — 2,439

— — — 2,244 — — 2,244 — 2,244

Restricted stock issuances ( 28,368 shares)

3 — — ( 426 ) — — ( 423 ) — ( 423 )

Distributions to noncontrolling interests

Purchase of treasury stock ( 85,213 shares)

— — ( 2,739 ) — — — ( 2,739 ) — ( 2,739 )

Distributions to noncontrolling interests — — — — — — — ( 458 ) ( 458 )

Balance at December 31, 2022 $ 1,325 $ 103 $ ( 11,504 ) $ 201,164 $ 156,359 $ ( 40,900 ) $ 306,547 $ ( 25 ) $ 306,522

— — — — 36,063 — 36,063 490 36,553

Other comprehensive loss — — — — — ( 5,892 ) ( 5,892 ) — ( 5,892 )

Net earnings — — — — 25,707 — 25,707 303 26,010

Other comprehensive income — — — — — 2,031 2,031 — 2,031

Share-based compensation expense — — — 2,290 — — 2,290 — 2,290

— — — 2,439 — — 2,439 — 2,439

Restricted stock issuances ( 47,189 shares)

2 unchanged sentences

— — ( 5,915 ) — — — ( 5,915 ) — ( 5,915 )

Excise tax on net share repurchases — — ( 41 ) — — — ( 41 ) — ( 41 )

Distributions to noncontrolling interests — — — — — — — ( 195 ) ( 195 )

75 unchanged sentences

Goodwill and indefinite-lived trademarks are tested for impairment at least annually, and whenever events or changes in circumstances occur indicating that it is "more likely than not" impairment may have been incurred.

The Company has the option to first assess qualitative factors to determine whether it is "more likely than not" that the fair value of a reporting unit is less than its carrying amount as a basis for determining if it is necessary to perform the quantitative goodwill impairment test.

However, if the Company concludes otherwise, then it is required to perform the quantitative impairment test by calculating the fair value of the reporting unit and comparing it against its carrying amount.

The Company has the option to first assess qualitative factors to determine whether it is "more likely than not" that the fair value of a reporting unit is less than its carrying value as a basis for determining if it is necessary to perform the quantitative goodwill impairment test.

If the fair value exceeds the carrying value, no further evaluation is required and no impairment loss is recognized.

An impairment charge would be recognized to the extent the carrying amount of goodwill exceeds the reporting unit fair value.

An impairment charge would be recognized to the extent the carrying value of goodwill exceeds the reporting unit fair value.

The indefinite-lived trade names are tested for impairment either by employing the qualitative approach outlined above, or by comparing the carrying value to the fair value based on current revenue projections of the related operations, under the relief from royalty method.

2 unchanged sentences

The Company's required goodwill and indefinite-lived asset annual impairment test is completed as of the first day of the fourth fiscal quarter each year.

As described in Note 4 to the consolidated financial statements, the 2022 annual impairment test resulted in no impairment.

In the second quarter of 2021, an impairment charge was recorded and in 2020, the annual impairment test resulted in an impairment charge in the fourth quarter of 2020.

As described in Note 4 to the consolidated financial statements, the 2023 and 2022 annual impairment tests resulted in no impairment.

In 2021, an impairment charge was recorded.

Definite-lived intangible assets, such as customer relationships, patents and acquired technology, non-competition agreements, and certain trade names are amortized on a straight-line method over their estimated useful lives.

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Liabilities for loss contingencies arising from claims, assessments, litigation, fines, penalties, and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment and/or remediation can be reasonably estimated.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current financial statement presentation.

Recent Accounting Pronouncements

The Company evaluates the applicability and impact of all Accounting Standards Updates (ASUs) issued by the Financial Accounting Standards Board.

ASUs that became effective in 2022 or those issued but not yet effective, are either not applicable for the Company or are expected to have no material impact on the Company's consolidated financial statement.

The Company evaluates the applicability and impact of all Accounting Standards Updates ("ASUs") issued by the Financial Accounting Standards Board ("FASB").

Recent accounting pronouncements not yet adopted:

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.

The ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly reviewed by the chief operating decision maker ("CODM") and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets.

The ASU also allows, in addition to the measure that is most consistent with U.S.

GAAP, the disclosure of additional measures of segment profit or loss that are used by the CODM in assessing segment performance and deciding how to allocate resources.

The ASU is effective for the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and subsequent interim periods, with early adoption permitted.

The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

This ASU requires disclosure of specific categories in the rate reconciliation and additional information for reconciling items that meet a quantitative threshold.

The amendment also includes other changes to improve the effectiveness of income tax disclosures, including further disaggregation of income taxes paid for individually significant jurisdictions.

This ASU is effective for annual periods beginning after December 15, 2024.

Adoption of this ASU should be applied on a prospective basis.

Early adoption is permitted.

The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements and disclosures.

Note 2 – Revenues

The following table disaggregates net revenue by geographic region from contracts with customers based on net revenues generated by subsidiaries within that geographic location (in thousands) :

Note 2 – Revenues (continued)

Year Ended December 31, 2023

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$ 139,783 $ 122,528 $ 92,737 $ 355,048

Note 2 – Revenues (continued)

Year Ended December 31, 2022

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When a payment becomes due based on the contract terms, the Company will reduce the contract asset and record a receivable.

Contract liabilities are deferred revenues that are recorded when cash payments are received or due in advance of our performance obligations.

Contract liabilities are deferred revenues that are recorded when cash payments are received or due in advance of our

Note 2 – Revenues (continued)

performance obligations.

Our payment terms vary by the type and location of the products offered.

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December 31, 2023 $ 2,989 $ 8,712

Increase $ 420 $ 3,218

(Decrease) Increase $ ( 1,001 ) $ 729

The amount of revenue recognized during the year ended December 31, 2023 that was included in the contract liability balance at December 31, 2022 was $ 7.3 million.

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The Company recorded acquisition costs associated with this transaction of $ 1.2 million in the second quarter of 2021, which included legal fees, appraisal fees, investments banker fees and insurance costs.

Following are the supplemental consolidated financial results for the Company on an unaudited pro forma basis, as if the DTS acquisition had been consummated on January 1, 2021 (unaudited):

Year ended December 31,

Pro forma net revenues

Pro forma net earnings attributable to VPG stockholders

Pro forma basic earnings per share attributable to VPG stockholders

Pro forma diluted earnings per share attributable to VPG stockholders

Note 4 – Goodwill and Other Intangible Assets

At the beginning of 2022, the Company had four reporting units to which goodwill was allocated:

The Company has four reporting units to which goodwill is allocated:

steel, on-board weighing, DSI, and DTS.

6 unchanged sentences

The Company's required goodwill and indefinite-lived asset annual impairment test is completed as of the first day of the fourth fiscal quarter each year.

In 2022, the results of the quantitative impairment test for the DSI reporting unit indicated no impairment, with the fair value exceeding the carrying value by approximately 8 % for goodwill and 14 % for the indefinite-lived trade name.

The results for the quantitative impairment test for the DTS reporting unit indicated no impairment, with the fair value exceeding the carrying value by approximately 36 % for goodwill and 34 % for the indefinite-lived trade name.

In 2023, the results of the quantitative impairment test for the DSI and DTS reporting units indicated that the fair value of both reporting units exceeded their carrying values, and therefore no impairment was recognized.

Prior to 2022, the Company also had an instrumentation reporting unit.

The Company's analysis in 2021 resulted in an impairment for the instrumentation reporting unit, of $ 1.1 million in goodwill, which represented the remainder of the goodwill balance, and $ 0.1 million in indefinite-lived intangible trade name .

The Company's analysis in 2020 resulted in the fair value exceeding the carrying value for the instrumentation reporting unit and a non-cash impairment loss of $ 2.4 million for the instrumentation reporting unit.

The change in the carrying amount of goodwill by segment is as follows ( in thousands) :

The change in the carrying value of goodwill by segment is as follows ( in thousands) :

Total Measurement Systems Weighing Solutions

KELK Acquisition DSI Acquisition Pacific Instruments Acquisition DTS Acquisition Stress-Tek Acquisition

KELK Acquisition DSI Acquisition DTS Acquisition Stress-Tek Acquisition

Balance at January 1, 2022 $ 45,830 $ 6,706 $ 16,910 $ 15,903 $ 6,311

Goodwill acquired 15,903 — — — 15,903 —

Impairment charges ( 1,126 ) — — ( 1,126 ) — —

Adjustment to goodwill acquired 130 — — 130 —

Foreign currency translation adjustment ( 416 ) ( 393 ) ( 23 ) — —

Balance at December 31, 2022 45,544 6,313 16,887 16,033 6,311

Adjustment to goodwill acquired 130 — — — 130 —

Foreign currency translation adjustment 190 175 15 — —

22 unchanged sentences

Amortization expense was $ 3.8 million, $ 3.9 million, and $ 3.3 million, for the years ended December 31, 2023, 2022, and 2021, respectively.

Amortization expense in 2022 and 2021 included $ 1.4 million and $ 0.8 million related to the DTS acquisition.

Estimated annual amortization expense for each of the next five years is as follows (in thousands) :

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The following table summarizes the activity to date related to these programs in the accrued restructuring liability, which is comprised of the activity associated primarily with the employee termination costs.

The accrued restructuring liability balance

The accrued restructuring liability balance as of December 31, 2023 and 2022, respectively, is included in other accrued expenses in the accompanying consolidated balance sheets (in thousands) :

Note 5 – Restructuring Costs (continued)

as of December 31, 2022 and 2021, respectively, is included in other accrued expenses in the accompanying consolidated balance sheets (in thousands) :

Balance at beginning of year $ 183 $ —

32 unchanged sentences

Effect of foreign operations 2,378 1,246 2,096

Residual U.S.

tax on foreign earnings 899 291 ( 258 )

Change in valuation allowance 1,270 ( 1,629 ) ( 1,204 )

4 unchanged sentences

Effect of foreign exchange 128 667 ( 35 )

Loss of benefit of U.S.

net operating loss — — 1,064

Excess tax benefits related to share based compensation — — ( 168 )

Other ( 37 ) ( 44 ) 14

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The Company recognized approximately $ 22.5 million and $ 26.3 million of GILTI for the years ended December 31, 2023 and 2022, respectively.

For each of the years ended December 31, 2022 and 2021, the U.S.

tax on GILTI, net of foreign tax credits and research credits, was less than $ 0.1 million.

tax on GILTI, net of foreign tax credits and research credits, was less than $ 0.1 million for each of the years ended December 31, 2023 and 2022.

Any excess foreign tax credits associated with GILTI are lost and cannot be carried forward to future years.

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deferred tax assets was approximately $ 10.9 million and $ 8.7 million, respectively.

The net change in this valuation allowance was approximately $( 5.2 ) million, of which approximately $( 3.3 ) million related to state tax rate changes.

The net change in this valuation allowance was approximately $ 2.3 million, of which approximately $ 0.5 million related to state valuation allowances.

The change in valuation allowance related to state taxes exclusive of rate changes was $ 0.5 million benefit and $ 0.4 million expense for the years ended December 31, 2023 and 2022, respectively.

44 unchanged sentences

The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense.

Related to the unrecognized tax benefits noted above, for the years ended December 31, 2022, December 31, 2021 and December 31, 2020, the Company accrued total penalties and interest of ( 0.2 ) million, $ 0.1 million and $ 0.0 million , respectively.

As of December 31, 2022, December 31, 2021 and December 31, 2020, accrued penalties and interest were $ 0.0 million , $ 0.2 million and $ 0.1 million, respectively.

Related to the unrecognized tax benefits noted above, for the years ended December 31, 2023, 2022 and 2021, the Company accrued total penalties and interest of 0.0 million, $( 0.2 ) million and $ 0.1 million, respectively.

As of December 31, 2023, 2022 and 2021, accrued penalties and interest were $ 0.0 million , $ 0.0 million and $ 0.2 million, respectively.

Included in the balance of unrecognized tax benefits as of December 31, 2023, 2022, and 2021 is $ 0.8 million, $ 0.4 million, and $ 1.3 million, respectively, of tax benefits that, if recognized, would impact the effective tax rate.

The Company believes that it is reasonably possible that an increase in unrecognized tax benefits related to foreign exposures of between $ 0.1 million and $ 0.2 million may be necessary in 2024.

Furthermore, as of December 31, 2022, the Company anticipates that it will pay $ 0.1 million of its reserves for unrecognized tax benefits, and does not anticipate that any of its current unrecognized tax benefits will reverse within the next calendar year due to the expiration of the statute of limitations.

Furthermore, as of December 31, 2023, the Company does not anticipate that any of its current unrecognized tax benefits will reverse within the next calendar year due to the expiration of the statute of limitations.

The Company and its subsidiaries file U.S.

9 unchanged sentences

The conclusion of the tax examinations resulted in no change in tax.

During the fourth quarter of 2023, the Company received notice that an examination of 2021 and 2022 will begin in the first quarter of 2024 for one of its subsidiaries in France.

The Company also concluded a tax examination in Taiwan for one of its subsidiaries, covering the year 2021.

The conclusion of this tax examination resulted in no change in tax.

The Company is subject to ongoing income tax audits, administrative appeals and judicial proceedings in India spanning a number of years.

3 unchanged sentences

Deferred financing costs ( 144 ) ( 201 )

$ 60,799 $ 60,714

Long-term debt $ 31,856 $ 60,799

2020 Credit Agreement

3 unchanged sentences

The 2020 Credit Agreement terminates on March 20, 2025.

Interest payable on amounts borrowed under the 2020 Revolving Facility is based upon, at the Company’s option, (1) the greatest of:

the Agent’s prime rate, the Federal Funds rate, or a LIBOR floor (the “Base Rate”), or (2) LIBOR or CDOR plus a specified margin.

An interest margin of 0.25 % is added to Base Rate loans.

Depending upon the Company’s leverage ratio, an interest rate margin ranging from 1.50 % to 2.75 % per annum is added to the applicable LIBOR or CDOR rate to determine the interest payable on the LIBOR or CDOR loans.

On May 5, 2023, the Company entered into Amendment No.

1 to Third Amended and Restated Credit Agreement (the “Credit Agreement Amendment”) amending the Third Amended and Restated Credit Agreement, dated March 20, 2020.

The primary purpose of the changes made in the Credit Agreement Amendment were to update the interest rate provisions to replace LIBOR with SOFR for U.S.

dollar denominated loans as well as update the other applicable reference borrowing rates for foreign currency loans which took effect on June 15, 2023.

Interest payable on amounts borrowed under the 2020 Revolving Facility, taking into account the effect of the Credit Agreement Amendment, is based upon the following:

(a) for revolving credit loans denominated in US Dollars, the SOFR rate plus applicable credit spread;

and (b) for revolving credit loans denominated in foreign currencies, at other applicable local reference rates plus an interest margin.

Depending upon the Company’s leverage ratio, an interest rate margin ranging from 1.50 % to 2.75 % per annum is added to the applicable SOFR rate to determine the interest payable on the SOFR loans.

The Company is required to pay a quarterly fee of 0.25 % per annum to 0.40 % per annum on the unused portion of the 2020 Revolving Facility, which is determined based on the Company’s leverage ratio each quarter.

9 unchanged sentences

The Company had outstanding letters of credit under these short-term lines of credit of $ 2.4 million and $ 3.2 million at December 31, 2023 and 2022, respectively.

Aggregate annual maturities of long-term debt are as follows (in thousands) :

Note 7 – Long-Term Debt (continued)

Aggregate annual maturities of long-term debt are as follows (in thousands) :

Interest paid on third-party debt was $ 4.0 million, $ 2.3 million, and $ 1.2 million during the years ended December 31, 2023, 2022, and 2021, respectively.

10 unchanged sentences

On August 8, 2022, the Board of Directors of the Company authorized the repurchase of up to 600,000 shares of the Company’s outstanding common stock (the “Stock Repurchase Plan”).

The Stock Repurchase Plan will expire on August 11, 2023, and the Board of Directors authorized purchases thereunder to be made through an issuer repurchase plan adopted under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), open market purchases or private transactions, in accordance with the applicable federal securities laws, including Rule 10b-18 under the Exchange Act.

At December 31, 2022, the Company had repurchased 85,213 shares of its common stock under the Stock Repurchase Plan.

The Stock Repurchase Plan was originally set to expire on August 11, 2023, and the Board authorized purchases thereunder to be made through an issuer repurchase plan adopted under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), open market purchases or private transactions, in accordance with the applicable federal securities laws, including Rule 10b-18 under the Exchange Act.

On August 8, 2023, the Company announced that its Board of Directors extended the term of the previously approved stock repurchase plan to August 9, 2024.

From August 8, 2022 to December 31, 2023, the Company had repurchased an aggregate of 273,626 shares of its common stock under the Stock Repurchase Plan.

The Board of Directors is authorized, without further stockholder approval, to issue from time to time up to an aggregate of 1,000,000 shares of preferred stock in one or more series.

22 unchanged sentences

( 30,276 ) ( 11,243 ) ( 161 ) ( 11,404 ) ( 41,680 )

Reclassification adjustment for foreign currency translation

$ — $ 191 $ — 191 191

$ ( 35,008 ) $ ( 4,534 ) $ ( 1,358 ) $ ( 5,892 ) $ ( 40,900 )

December 31, 2023

5 unchanged sentences

( 41,489 ) 2,237 ( 10 ) 2,227 ( 39,262 )

Reclassification adjustment for foreign currency translation

$ ( 40,900 ) $ 2,072 $ ( 41 ) $ 2,031 $ ( 38,869 )

$ ( 35,008 ) $ ( 4,534 ) $ ( 1,358 ) $ ( 5,892 ) $ ( 40,900 )

In 2022, Reclassification of foreign currency translation adjustment for gain on liquidation of a subsidiary is included in other income (expense) other (See Note 15).

26 unchanged sentences

Interest cost 97 675 65 395

Actuarial gains ( 533 ) ( 7,125 ) ( 103 ) ( 792 )

Actuarial loss/(gains) 59 6 ( 533 ) ( 7,125 )

Benefits paid ( 108 ) ( 573 ) ( 108 ) ( 652 )

Curtailments and settlements — ( 310 ) — ( 567 )

Plan amendments and other — — — ( 172 )

Currency translation — 551 — ( 2,663 )

8 unchanged sentences

Funded status at end of year $ ( 2,098 ) $ 1,852 $ ( 2,050 ) $ 395

Actuarial gains incurred in 2022 and 2021 related to our U.S.

plans are primarily the result of an increase in the discount rate assumptions used to estimate the benefit obligations as of December 31, 2022 compared to December 31, 2021 and as of December 31, 2021 compared to December 31, 2020.

Actuarial losses incurred in 2023 related to our U.S.

plans are primarily the result of the decrease discount rate assumptions used to estimate the benefit obligation as of December 31, 2023 compared to December 31, 2022.

Actuarial gains incurred in 2022 related to our U.S.

plans are primarily the result of an increase in the discount rate assumptions used to estimate the benefit obligations as of December 31, 2022 compared to December 31, 2021.

Amounts recognized in the consolidated balance sheets consist of the following pre-tax amounts (in thousands) :

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$ 2,050 $ 2,448

Fair value of plan assets

Unrecognized gains and losses are amortized into future net periodic pension cost using the 10% corridor method over the expected remaining service life of the employee group.

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— 39 22 736 27 459

Amortization of prior service cost — ( 10 ) — — — —

Amortization of transition obligation

68 unchanged sentences

Contributions by participants — —

Actuarial gains ( 453 ) ( 591 )

Actuarial losses/(gains) 95 ( 453 )

Benefits paid ( 119 ) ( 142 )

8 unchanged sentences

Funded status at end of year $ ( 2,490 ) $ ( 2,386 )

Actuarial gains incurred in 2022 and 2021 related to our post-retirement plans are primarily the result of an increase in the discount rate assumptions used to estimate the benefit obligations as of December 31, 2022 and December 31, 2021 and as of December 31, 2021 compared to December 31, 2020.

Actuarial losses incurred in 2023 related to our post-retirement plans are primarily the result of the decrease discount rate assumptions used to estimate the benefit obligation as of December 31, 2023 compared to December 31, 2022.

Actuarial gains incurred in 2022 related to our post-retirement plans are primarily the result of an increase in the discount rate assumptions used to estimate the benefit obligations as of December 31, 2022 compared to December 31, 2021.

Amounts recognized in the consolidated balance sheets consist of the following pre-tax amounts (in thousands) :

6 unchanged sentences

$ ( 367 ) $ ( 484 )

Note 9 – Pensions and Other Postretirement Benefits (continued)

Unrecognized gains and losses are amortized into future net periodic benefit cost using the 10% corridor method over the expected remaining service life of the employee group.

The following table sets forth the components of net periodic benefit costs (in thousands) :

Note 9 – Pensions and Other Postretirement Benefits (continued)

Years ended December 31,

2 unchanged sentences

Interest cost

Amortization of actuarial losses

Amortization of actuarial (gains)/ losses ( 22 ) 3 20

Net periodic benefit cost

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As the plans are unfunded, the Company's anticipated contributions for 2024 are equal to the estimated benefit payment.

Note 9 – Pensions and Other Postretirement Benefits (continued)

Other Retirement Obligations

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employees are eligible to participate in 401(k) savings plans which provide company matching under various formulas.

The Company’s matching expense for the plans was $ 1.1 million, $ 1.0 million, and $ 0.8 million for the

Note 9 – Pensions and Other Postretirement Benefits (continued)

years ended December 31, 2022, 2021, and 2020, respectively.

The Company’s matching expense for the plans was $ 1.2 million, $ 1.1 million, and $ 1.0 million for the years ended December 31, 2023, 2022, and 2021, respectively.

No material amounts are included in the consolidated balance sheets related to unfunded 401(k) contributions.

5 unchanged sentences

The assets held in the rabbi trust are invested in money market funds and company-owned life insurance policies.

The consolidated balance sheets include assets held in trust related to the nonqualified deferred compensation plan of $ 3.9 million at December 31, 2022 and $ 4.2 million at December 31, 2021, and the related liabilities of $ 5.3 million and $ 6.0 million at December 31, 2022 and 2021, respectively.

The consolidated balance sheets include assets held in trust related to the nonqualified deferred compensation plan of $ 4.3 million and $ 3.9 million at December 31, 2023 and 2022 respectively, and the related liabilities of $ 5.6 million and $ 5.3 million at December 31, 2023 and 2022, respectively.

Note 10 – Share-Based Compensation

On May 26, 2022, t he Company’s stockholders voted to approve the adoption of the Vishay Precision Group, Inc.

2022 Stock Incentive Plan (the "2022 plan"), which replaced the Amended and Restated Vishay Precision Group, Inc.

2010 Stock Incentive Program (the "previous plan").

The 2022 plan permits the issuance of up to 608,000 shares of common stock, which includes approximately 308,000 shares that were reserved for issuance under the previous plan and up to an additional 197,685 additional shares underlying awards outstanding under the previous plan.

At December 31, 2022, the Company had reserved 590,034 shares of common stock for future grant of equity awards (restricted stock, unrestricted stock, restricted stock units (“RSUs”), or stock options).

If any outstanding awards expire, are canceled or are forfeited, the underlying shares would be available for future grants under the Plan.

The Vishay Precision Group, Inc.

2022 Stock Incentive Plan (the "2022 plan") permits the issuance of up to 608,000 shares of common stock.

At December 31, 2023, the Company had reserved 525,239 shares of common stock for future grant of equity awards (restricted stock, unrestricted stock, restricted stock units (“RSUs”), or stock options) pursuant to the 2022 Plan.

If any outstanding awards are forfeited by the holder or canceled by the Company, the underlying shares would be available for re-grant to others.

If shares are withheld for payment of taxes, those shares do not become available for future grant under the 2022 plan.

Restricted Stock Units

4 unchanged sentences

The Company recognizes compensation cost for RSUs that are expected to vest and for which performance criteria are expected to be met.

On January 1, 2022, and in accordance with the Company's 2017 Non-Employee Director Compensation Plan (the "Director Plan"), the Board of Directors approved the issuance of an aggregate of 595 RSUs to the newly-appointed independent member of the Board of Directors.

This award represented a pro-rated portion of the annual equity grant made to non-executive directors pursuant to the Director Plan.

The aggregate grant-date fair value of this award is immaterial, and the award vested on May 26, 2022, the date of the 2022 Annual Stockholders Meeting.

On March 3, 2022, and in accordance with their respective employment agreements, VPG’s three executive officers were granted annual equity awards in the form of RSUs, of which 50 % are performance-based.

On February 28, 2023, and in accordance with their respective employment agreements, VPG’s three executive officers were granted annual equity awards in the form of RSUs, of which 50 % are performance-based.

The awards have an aggregate target grant-date fair value of $ 1.9 million were comprised of 43,243 RSUs.

6 unchanged sentences

The performance-based portion of the RSUs will also vest on January 1, 2026, subject to the employees' continued employment and the satisfaction of certain performance objectives relating to three-year cumulative earnings and cash flow goals, each weighted equally.

On May 26, 2022 and in accordance with the Company's 2017 Non-Employee Director Compensation Plan, as amended at such time, the Board of Directors approved the issuance of an aggregate of 16,534 RSUs to the independent board members of the Board of Directors and to the non-executive Chairman of the Board of Directors.

On May 24, 2023 and in accordance with the Company's 2017 Non-Employee Director Compensation Plan, as amended at such time, the Board of Directors approved the issuance of an aggregate of 13,923 RSUs to each of the Company's non-employee directors.

The awards have an aggregate grant-date fair value of $ 0.5 million and will vest on the earlier of the 2024 Annual Stockholders meeting or May 24, 2024, subject to the directors' continued service on the Board of Directors.

On July 1, 2022, a non-executive VPG employee was granted an annual equity award in the form of RSU's, of which 50 % are performance-based.

The award has an aggregate grant-date fair value of $ 0.04 million and was comprised of 1,432 RSU's.

Note 10 – Share-Based Compensation (continued)

non-performance portion of this award will vest on July 1, 2025, subject to the employees' continued employment.

The performance-based portion of the RSUs will also vest on July 1, 2025, subject to the employees' continued employment and the satisfaction of certain performance objectives relating to three-year cumulative earnings and cash flow goals, each weighted equally.

Vesting of equity awards may be subject to acceleration under certain circumstances.

Note 10 – Share-Based Compensation (continued)

RSU activity is presented below (number of RSUs in thousands) :

11 unchanged sentences

End of year 202 $ 35.50 204 $ 29.92 198 $ 31.07

The fair value of the RSUs vested during 2022 is $ 1.3 million, which approximates grant date fair value.

The fair value of the RSUs vested during 2023 was $ 2.7 million.

Included in the 2023, 2022 and 2021 activity are RSU's forfeited as a result of performance objectives not being met.

3 unchanged sentences

January 1, 2024 33 1 34

January 1, 2025 and July 1 2025 24 10 34

January 1, 2026 14 16 30

Share-Based Compensation Expense

4 unchanged sentences

Share-based compensation expense is recognized ratably over the vesting period of the awards and for RSUs with performance criteria, is recognized for RSU's that are expected to vest and for which performance criteria are expected to be met.

During the fourth quarter of 2022, a net adjustment of $ 0.3 million increasing share-based compensation expense was recorded, based on the valuation of performance objectives associated primarily with awards granted in 2020.

During 2023, a net adjustment of $ 0.4 million decreasing share-based compensation expense was recorded, based on the evaluation of performance objectives associated with awards granted in 2021, 2022 and 2023.

It was determined that certain objectives were not likely to be fully met, necessitating a reversal of certain compensation expense associated with those awards.

During the fourth quarter of 2022, a net adjustment of $ 0.3 million increasing share-based compensation expense was recorded, based on the evaluation of performance objectives associated primarily with awards granted in 2020.

It was determined that certain objectives, which were deemed not likely to be met in previous years, were met.

1 unchanged sentence

It was determined that certain objectives, which were deemed not likely to be met in previous years, were met.

During the fourth quarter of 2020, a net adjustment decreasing share-based compensation expense by $ 0.1 million was recorded, based on the evaluation of performance objectives associated with awards granted in 2018, 2019 and 2020.

It was determined that certain objectives were not likely to be fully met, necessitating a reversal of certain compensation expense associated with those awards.

This was partially offset by additional share based compensation expense being recorded for certain objectives being fully met, which had been reversed in the prior year.

Note 10 – Share-Based Compensation (continued)

The total tax benefit on share-based compensation expense was $ 0.5 million, $ 0.5 million and $ 0.5 million for the years ended December 31, 2023, 2022 and 2021, respectively.

21 unchanged sentences

At December 31, 2023 and 2022, the Company had no significant concentrations of credit risk.

Note 11 – Commitments, Contingencies, and Concentrations (continued)

Geographic Concentrations

9 unchanged sentences

Note 12 - Leases

The Company primarily leases office and manufacturing facilities in addition to vehicles, which have remaining terms of less than one year to fourteen years .

The Company primarily leases office and manufacturing facilities in addition to vehicles, which have remaining terms of less than one year to thirteen years .

Note 12 - Leases ( continued)

Leases recorded on the balance sheet consist of the following (in thousands) :

15 unchanged sentences

The Company paid $ 5.1 million for its operating leases for the year ended December 31, 2023 and $ 5.1 million for the year ended December 31, 2022, which are included in operating cash flows on the consolidated statements of cash flows.

Note 12 - Leases ( continued)

Undiscounted maturities of operating lease payments as of December 31, 2023 are summarized as follows (in thousands) :

30 unchanged sentences

Segment operating income (loss) 41,671 21,232 18,399 ( 37,503 ) 43,799

Acquisition costs — — 1,198 — 1,198

Impairment of goodwill and indefinite-lived intangibles — — 1,223 — 1,223

Restructuring costs 1,460 — 58 — 1,518

6 unchanged sentences

Segment operating income (loss) 26,527 23,184 13,480 ( 35,819 ) 27,372

Acquisition costs — — 1,198 — 1,198

Impairment of goodwill and indefinite-lived intangibles — — 1,223 — 1,223

23 unchanged sentences

Basic earnings per share are computed using the weighted average number of common shares outstanding during the periods presented.

Diluted earnings per share is computed using the weighted average number of common shares outstanding, adjusted to include the potentially dilutive effect of stock options and restricted stock units (see Note 10), and other potentially dilutive securities.

Diluted earnings per share is computed using the weighted average number of common shares outstanding, adjusted to include the potentially dilutive effect of restricted stock units (see Note 10), and other potentially dilutive securities.

The following table sets forth the computation of basic and diluted earnings per share attributable to VPG stockholders (in thousands, except earnings per share) :

21 unchanged sentences

2023 2022 2021

Foreign exchange gain/(loss) $ 3,579 $ ( 110 ) $ ( 2,246 )

Foreign exchange (loss)/gain $ ( 822 ) $ 3,579 $ ( 110 )

Interest income 1,651 401 252

3 unchanged sentences

Foreign currency exchange gains and losses represent the impact of changes in foreign currency exchange rates.

The change in foreign exchange gains / (losses) for the year ended December 31, 2023, as compared to the prior year period, is primarily due to fluctuations in the Israeli shekel, the Canadian dollar and the British pound.

The change in the dollar-shekel exchange rate resulted in a unfavorable currency exchange impact primarily related to the shekel-denominated lease liability for the Sensors facility in Israel.

Note 15 – Additional Financial Statement Information (continued)

Foreign currency exchange gains and losses represent the impact of changes in foreign currency exchange rates.

The change in foreign exchange gains / (losses) for the year ended December 31, 2022, as compared to the prior year period, is primarily due to fluctuations in the Israeli shekel, the Japanese yen and the British pound.

The change in the dollar-shekel exchange rate resulted in a favorable currency exchange impact primarily related to the shekel-denominated lease liability for the Sensors facility in Israel.

Note 15 – Additional Financial Statement Information (continued)

The change in foreign exchange gains / (losses) for the year ended December 31, 2021, as compared to the prior year period, was primarily due to fluctuations in the Israeli shekel.

The change in the dollar-shekel exchange rate in 2020 reflected an unfavorable currency exchange impact primarily related to the shekel-denominated lease liability for the Sensors facility in Israel.

Additionally, in 2021, there were favorable foreign exchange impacts from the Japanese yen and the Canadian dollar.

Pension expense represents the net periodic benefit cost excluding the service cost.

29 unchanged sentences

These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.

Unobservable inputs that reflect the Company’s own assumptions.

Note 16 – Fair Value Measurements (continued)

Unobservable inputs that reflect the Company’s own assumptions.

An asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

22 unchanged sentences

Lease receipts and payments related to the shared facilities are immaterial.

Note 18 – Subsequent Events

Executive RSU grant

On February 28, 2023, VPG’s three current executive officers were granted annual equity awards in the form of RSUs, of which 50 % are performance-based and 50 % are service-based.

The awards have an aggregate target grant-date fair value of $ 1.9 million and were comprised of 43,243 RSUs.

The service-based awards will vest on January 1, 2026, subject to the executives continued employment.

The performance-based awards will also vest on January 1, 2026, subject to the executives continued employment and the satisfaction of certain performance objectives relating to three-year cumulative “adjusted free cash flow” and net earnings goals.

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-K

Item 9A. Controls and Procedures