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

We maintain credit facilities with several financial institutions through our entities worldwide totaling $84 million. In some cases, our foreign credit lines are unsecured, uncommitted and may be repayable on demand.

On September 2, 2015, the Company and Diodes International B.V. (the “Foreign Borrower” and, collectively with the Company, the “Borrowers”), and certain subsidiaries of the Company as guarantors, entered into an Amendment No. 3 to Credit Agreement, Incremental Term Assumption Agreement, Limited Waiver and Consent (the “Amendment”) with Bank of America, N.A., as Administrative Agent, and the lenders party to the Amendment (collectively, the “Lenders”), which amends the Credit Agreement dated January 8, 2013 (as previously amended by Amendment No. 1 to Credit Agreement and Limited Waiver dated as of November 1, 2013 and Amendment No. 2 to Credit Agreement and Amendment No. 1 to Collateral Agreement dated as of June 19, 2015) (as previously amended and as amended by the Amendment, the “Credit Agreement”).

The Amendment increases the Company’s existing senior credit facility to a $400 million revolving senior credit facility (the “Revolver”), which includes a $10 million swing line sublimit, a $10 million letter of credit sublimit, and a $20 million alternative currency sublimit, and a $100 million term loan facility (the “Term Loan Facility”). We may from time to time request additional increases in the aggregate commitments 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 commitments being in the form of term loans, with the remaining amount of each increase being an increase in the amount of the Revolver. The Revolver and the Term Loan Facility mature on January 8, 2018 (the “Maturity Date”). The Company used a portion of the proceeds available under the Revolver and the Term Loan Facility to finance a portion of the purchase price for the Pericom acquisition, with the remaining proceeds available for working capital, for capital expenditures, and for general corporate purposes, including financing other permitted acquisitions.

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 restricted payments (including dividends) (as such terms are defined in the Amendment or the Credit Agreement).

As of December 31, 2015, our U.S. and Asia subsidiaries had unused and available credit lines of up to an aggregate of approximately $83 million, with several financial institutions. In some cases, our foreign credit lines are unsecured, uncommitted and may be repayable on demand, except for two Taiwanese credit facilities that are collateralized by assets. Our foreign credit lines bear interest at LIBOR or similar indices plus a specified margin. At December 31, 2015, there were no amounts outstanding on these credit lines.

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 under the Revolver and the Term Loan Facility bear interest at a rate per annum equal to (a) a base rate (equal to the highest of (i) the Federal Funds Rate plus ¹⁄₂ of 1.00%, (ii) Bank of America’s “prime rate”, and (iii) the Eurocurrency Rate plus 1.00%,) plus 0.50% and 1.50%, based upon the Borrowers’ Consolidated Leverage Ratio, or (b) the Eurocurrency Rate plus 1.50% and 2.50%, based upon the Borrowers’ Consolidated Leverage Ratio. The Revolver also bears a commitment fee of 0.25% to 0.40% based on the Borrowers’ Consolidated Leverage Ratio.

The unused and available credit under the various facilities as of December 31, 2015, was approximately $83 million (net of approximately $1 million credit used for import and export guarantee), as follows:

2015

Outstanding at December 31,

Lines of Credit

Terms

2015

2014

84,326

Unsecured, interest at LIBOR plus margin, due

quarterly

1,064

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

	2015			2014
Notes payable to Taiwan bank, original principal amount of TWD 132 million, variable interest (approximately 1.9% as of December 31, 2015), matures July 6, 2021.		1,723			2,074
Term loan and revolver		464,500			139,000
Total long-term debt		466,223			141,074
Less: Current portion		(10,282	)		(287	)
Long-term debt, net of current portion	$	455,941		$	140,787

The table below sets forth the annual contractual maturities of long-term debt at December 31, 2015:

2016	$	10,282
2017		287
2018		454,793
2019		299
2020		299
Thereafter		263
Total long-term debt	$	466,223