NOTE 7 – BANK CREDIT AGREEMENTS AND OTHER SHORT-TERM AND LONG-TERM DEBT

Lines of Credit – We maintain lines of credit with several financial institutions through our entities worldwide totaling $92 million. In some cases, our foreign credit lines are unsecured, uncommitted and may be repayable on demand.

Revolving Senior Credit Facility—On January 8, 2013, we and Diodes International B.V. (the “Foreign Borrower” and collectively with us, the “Borrowers”) and certain subsidiaries of ours as guarantors, entered into a Credit Agreement (the “Credit Agreement”) with Bank of America, N.A. (“Bank of America”) and other participating lenders (collectively, the “Lenders”).

The Credit Agreement provides for a five-year, $300 million revolving senior credit facility (the “Revolver”), which includes $10 million swing line sublimit, a $10 million letter of credit sublimit, and $20 million alternative currency sublimit. The Borrowers may from time to time request increases in the aggregate commitment under the Credit Agreement of up to $200 million, subject to the Lenders electing to increase their commitments or by means of the addition of new Lenders, and subject to at least half of each increase in aggregate commitment being in the form of term loans (“Incremental Term Loans”), with the remaining amount of each being an increase the amount of the Revolver. Incremental Term Loans will be on pricing and amortization terms to be agreed upon.

The Revolver matures on January 8, 2018 (the “Revolver Maturity Date”). Incremental Term Loans mature no earlier than the Revolver Maturity Date. The proceeds under the Revolver and the Incremental Term Loans may be used for the purposes of refinancing certain existing debt, for working capital and capital expenditures, and for general corporate purposes, including financing permitted acquisitions.

The Foreign Borrower’s obligations under the Credit Agreement are guaranteed by us. Each Borrower’s obligations under the Credit Agreement are guaranteed by certain of that Borrower’s subsidiaries. The Borrower’s obligations under the Credit Agreement are secured by substantially all assets of the Borrowers and certain of their subsidiaries.

Under the Revolver, the Borrowers may borrow in United States Dollars (“USD”), Euros, British Pounds Sterling or another currency approved by the Lenders. Borrowed amounts bear interest at a rate per annum equal to the sum of (a) the highest of (i) the Federal Funds Rate plus ¹⁄₂ of 1.00%, (ii) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate,” and (iii) the Eurocurrency Rate plus 1.00%, plus (b) an amount between 0.50% per annum and 1.25% per annum, based upon the Borrowers’ and their subsidiaries’ Consolidated Leverage Ratio. Eurocurrency loans bear interest at LIBOR plus an amount between 1.50% and 2.25% per annum, based upon the Borrowers’ and their subsidiaries’ Consolidated Leverage Ratio.

The Credit Agreement contains certain financial and non-financial covenants, including, but not limited to, a maximum Consolidated Leverage Ratio, a minimum Consolidated Fixed Charge Coverage Ratio, and restrictions on liens, indebtedness, investments, fundamental changes, dispositions, and restrictive payments (including dividends). As of December 31, 2014, we were in compliance with the bank covenants.

In connection with the acquisition of BCD, we drew down on the Revolver to fund the acquisition and pay for costs associated with the acquisition. We have been paying down the balance on the Revolver, and as of December 31, 2014, the outstanding balance of the Revolver is $139 million.

The unused and available credit under the various facilities as of December 31, 2014, was approximately $89 million (net of approximately $3 million credit used for import and export guarantee), as follows:

2014

Outstanding at December 31,

Lines of Credit

Terms

2014

2013

92,440

Unsecured, interest at LIBOR plus margin, due

quarterly

1,064

5,814

Long-term debt – The balances as of December 31, consist of the following:

	2014			2013
Notes payable to Taiwan bank, principal amount of TWD 158 million, variable interest (approximately 2.0% and 2.1% as of December 31, 2014 and 2013, respectively), of which TWD 132 million matures on July 6, 2021, and TWD 26 million matured July 6, 2013, secured by land and building.		2,074			2,500
Notes payable to Taiwan banks, variable interest between 1.8% and 2.5% as of December 31, 2013, maturity dates range from 2013 to 2023, secured by land, building and equipment.		-			2,426
Revolver		139,000			179,000
Total long-term debt		141,074			183,926
Less: Current portion		(287	)		(1,127	)
Long-term debt, net of current portion	$	140,787		$	182,799

The annual contractual maturities of long-term debt at December 31, 2014 are as follows:

2015		287
2016		292
2017		298
2018		304
2019		139,310
Thereafter		583
Total long-term debt	$	141,074