METHODE ELECTRONICS INC

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Except as updated below, there have been no material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended May 3, 2025:

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We operate our business on a global basis and changes to trade policy, including tariffs and customs regulations, could have a material and adverse effect on our business.

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We manufacture and sell our products globally and rely on a global supply chain to deliver the required raw materials, components, and parts, as well as the final products to our customers. Existing free trade laws and regulations, such as the United States-Mexico-Canada Agreement (“USMCA”), provide certain duties and tariffs for qualifying imports and exports, subject to compliance with the applicable classification and other requirements. Changes in laws or policies governing the terms of foreign trade, and in particular increased trade restrictions, export licenses, tariffs or taxes on imports from countries or geographic regions where we manufacture products, such as Canada, China, Egypt, Europe and Mexico, could have a material adverse effect on our business, financial condition and operating results.

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In the past several months, the U.S. administration has proposed and imposed extensive tariffs on many countries where we do business including a number of broad, product specific tariffs most notably with respect to the automotive and commercial vehicle industries. As such, there is continued uncertainty about the future relationship between the U.S. and various other countries with respect to tariffs, trade policies, government regulations, treaties and trade agreements. Depending upon the continued duration and potential expansion of these tariffs, as well as our ability to mitigate their impact, these tariffs and other regulatory actions could materially affect our business, including in the form of an increase in cost of goods sold, decreased margins, increased pricing for customers, disruptions in our supply chain, impaired ability to compete effectively, and reduced sales. If changes in trade policy cause increased prices for vehicles, consumer demand may decline, prompting a reduction in global vehicle production volumes, which is a material driver of our operations, sales and profitability.

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Although the exception for USMCA-qualifying goods is expected to remain in place, the extent and permanence of this exception has not been confirmed by the current U.S. Administration. In addition to potential increases in customs duties and tariffs in the U.S. and other countries, the USMCA is subject to renewal in 2026. There can be no assurance that the USMCA will be renewed or, if renewed, any newly negotiated terms in the USMCA will not adversely affect our business.

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Our product portfolio exposes us to several categories that are highly contested in the expanding international trade disputes. For example, because we provide parts to automotive OEMs, some of our finished goods are classified as auto parts and subject to additional tariffs. Our products made for commercial vehicle customers could be potentially exposed to similar tariffs. We also utilize semiconductors and copper--and to a lesser extent--steel and aluminum in our products. This means we are exposed to increased costs for inbound components and could potentially be added as derivative products for tariff purposes in the future. Should any of these tariffs expand, raw materials and finished goods that we import will face higher prices, which could lead to reduced margins or increased prices that could, in turn, cause decreased customer demand.

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Item 3. Defaults Upon Senior Securities

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The information set forth under the subheading “Revolving credit facility” contained in Note 8, “Debt” to the Company’s

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condensed consolidated financial statements in Part I. Financial Information – Item 1. Financial Statements of this Form 10-Q is

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incorporated herein by reference into this Item 3.

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Waiver Letter regarding Second Amended and Restated Credit Agreement

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Because we are filing this Quarterly Report within four business days after the triggering event, we are making the following disclosure under this Item 5, “Other Information” instead of filing (as and to the extent required) a Current Report on Form 8-K under Item 1.01, Entry into a Material Definitive Agreement, and Item 2.03, Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

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On September 8, 2025, the Company entered into a Waiver Letter (the “Waiver Letter”) among the Company, Bank of America, N.A., as Administrative Agent, and the other Lenders party thereto.

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The Waiver Letter acknowledged that an event of default under the Company’s Second Amended and Restated Credit Agreement, dated as of October 31, 2022, as amended, supplemented, restated or otherwise modified from time to time (which credit agreement, as previously amended by the first amendment, the second amendment and the third amendment thereto, is referred to solely in this Item 5, “Other Information” section of this Quarterly Report as the “Credit Agreement”), by and among the Company, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, the other Lenders party thereto and the other parties thereto, occurred as the result of the Company making approximately $2.8 million of restricted payments during the quarter ended August 2, 2025, which was in excess of the $2.5 million general basket exception to a covenant restricting certain restricted payments (including dividends) by the Company and its subsidiaries during the quarter ended August 2, 2025. In addition, among other things, the Waiver Letter:

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(i) Reduced, for the quarter ending November 1, 2025, the general basket exception to a covenant restricting certain restricted payments (including dividends) by the Company and its subsidiaries by the amount of excess restricted payments made during the quarter ended August 2, 2025 (which change reduced such basket exception from $2.5 million to approximately $2.2 million for the quarter ending November 1, 2025); and

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(ii) Waived the acknowledged event of default.

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The foregoing description of the Waiver Letter does not purport to be complete and is qualified in its entirety by reference to the complete text of the Waiver Letter, which is filed as Exhibit 10.7 to this Quarterly Report and is incorporated herein by reference.

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Trading Arrangements