SCANSOURCE, INC.

Previous wording

ScanSource is a leading technology distributor uniquely positioned to address complex, converging technologies and to accelerate growth for channel sales partners across hardware, SaaS, connectivity and cloud. We provide technology solutions and services from approximately 500 leading suppliers of mobility and barcode, POS, payment terminals, physical security, networking, communications, connectivity and cloud services to our approximately 25,000 channel sales partners located primarily in the United States and Brazil.

Current wording

ScanSource is a leading technology distributor uniquely positioned to address complex technologies and to accelerate growth for channel sales partners across hardware, SaaS, connectivity, cloud and services. Our recent acquisition of MicroAge expands our offerings to include hardware and managed services to end-users across cloud, AI, data center, and cybersecurity. We provide technology solutions and services from approximately 700 leading suppliers of mobility and barcode, POS, payment terminals, physical security, networking, communications, connectivity, cloud, data center and cyber security to our approximately 27,000 channel sales partners and end-users located primarily in the United States, Canada and Brazil.

Previous wording

We sell hardware, SaaS, connectivity and cloud solutions and services to channel sales partners that are designed to solve end users’ challenges. We operate distribution facilities that primarily support our United States business in Mississippi, California and Kentucky. Brazil distribution facilities are located in the Brazilian states of Paraná, Espirito Santo and Santa Catarina. We provide some of our digital products, which include SaaS and subscriptions, through our digital tools and platforms.

Current wording

We operate product distribution facilities in Mississippi, California, and Kentucky that support the United States and Canada. Brazil product distribution facilities are located in the Brazilian states of Paraná, Espirito Santo and Santa Catarina.

Previous wording

The macroeconomic environment, including the economic impacts of growth outlook, inflationary pressures, tariffs and evolving geopolitical conflicts and trade relationships, continues to create significant uncertainty and may adversely affect our financial condition and results of operations. In 2026, the U.S. Supreme Court invalidated the tariffs imposed under the International Emergency Economic Powers Act (IEEPA); however, certain other tariffs remain in effect and the current administration has indicated that it will continue seeking to implement tariffs through other statutory authorities. Further, the ongoing conflict with Iran and geopolitical tensions has resulted in volatility in the global energy and commodity markets and increased uncertainty in the macroeconomic environment. International trade policy and diplomatic dynamics continue to shift, and the full implications remain uncertain. We remain mindful of the potential impact these conditions could have on our channel sales partners, suppliers and end-user demand. We are actively monitoring changes to the global macroeconomic environment and assessing the potential impacts these challenges may have on our financial condition, results of operations and liquidity. We expect to pass through to our channel sales partners any supplier price increases resulting from tariffs or other factors. We are also mitigating related risks through strategic planning and maintaining financial flexibility; however, we cannot predict the effectiveness of our mitigation strategies or the ultimate impact of tariffs and the global macroeconomic environment on our financial condition or results of operations.

Current wording

The macroeconomic environment, including the economic impacts of growth outlook, inflationary pressures, tariffs and evolving geopolitical conflicts and trade relationships, continues to create significant uncertainty and may adversely affect our financial condition, results of operations and liquidity. We remain mindful of the potential impact these conditions could have on our channel sales partners, suppliers and end-user demand. We expect to pass through to our channel sales partners any supplier price increases resulting from tariffs or other factors. While we are monitoring these conditions and maintaining financial flexibility to mitigate potential impacts; the extent and duration of any effects remain uncertain.

Previous wording

Our strategy is to drive sustainable, profitable growth by providing complex, converging technology solutions through a growing ecosystem of channel sales partners leveraging our people, processes and tools. Our goal is to provide exceptional experiences for our channel sales partners, suppliers and employees, and we strive for operational excellence. Our differentiated technology distribution strategy utilizes multiple sales models to offer hardware, SaaS, connectivity and cloud services from leading technology suppliers to channel sales partners that solve end users’ challenges. ScanSource enables channel sales partners to deliver solutions for their end users to address changing buying and consumption patterns. Our solutions may include a combination of offerings from multiple suppliers or give our channel sales partners access to additional services. As a trusted adviser to our channel sales partners, we provide converged solutions through our strong understanding of end-user needs.

Current wording

Our strategy is to drive sustainable, profitable growth by providing complex technology solutions through a growing ecosystem of channel sales partners leveraging our people, processes and tools. Our goal is to provide exceptional experiences for our channel sales partners, suppliers and employees, and we strive for operational excellence. Our differentiated technology distribution strategy utilizes multiple sales models to offer hardware, SaaS, connectivity, cloud and services from leading technology suppliers to channel sales partners that solve end users’ challenges. ScanSource enables channel sales partners to deliver solutions for their end users to address changing buying and consumption patterns. Our solutions may include a combination of offerings from multiple suppliers or give our channel sales partners access to additional services. As a trusted adviser to our channel sales partners, we provide innovative solutions through our strong understanding of end-user needs.

Previous wording

We have two reportable segments, which are based on sales channels. The following tables summarize our net sales results by operating segment and by geographic location for the quarters and nine months ended March 31, 2026 and 2025:

Current wording

We have two reportable segments, which are based on sales channels. The following tables summarize our net sales results by operating segment and by geographic location for the quarters ended September 30, 2026 and 2025:

Previous wording

The Specialty Technology Solutions segment consists of sales to channel partners primarily in the United States and Brazil. For the quarter ended March 31, 2026, net sales increased $62.3 million, or 9.2%, compared to the prior-year period. Excluding the impact of acquisitions and the impact of foreign exchange rate fluctuations, adjusted net sales increased$54.1 million, or 8.0%, for the quarter ended March 31, 2026. The increase for the quarter is primarily a result of growth across most technologies in North America. For the nine months ended March 31, 2026, net sales increased $43.7 million, or 2.0%, compared to the prior-year period. Excluding the impact from acquisitions and the impact from foreign exchange rate fluctuations, adjusted net sales increased $24.4 million, or 1.1%, for the nine months ended March 31, 2026, compared to the prior-year period. The increase innet sales for the nine months ended March 31, 2026 is primarily due to growth across most technologies in North America.

Current wording

The Specialty Technology Solutions segment consists of sales to channel partners in the United States, Canada and Brazil. For the quarter ended September 30, 2026, net sales increased $201.9 million, or 28.2%, compared to the prior-year quarter. Excluding the impact of acquisitions and the impact of foreign exchange rate fluctuations, non-GAAP net sales increased$197.1 million, or 27.5%, for the quarter ended September 30, 2026 compared to the prior-year quarter. The increase in net sales and non-GAAP net sales for the quarter is primarily due to broad-based growth in North America.

Previous wording

The Intelisys & Advisory segment consists of sales and services to both channel partners (Intelisys) and end users (Advisory) in the United States. For the quarter ended March 31, 2026, net sales decreased $0.4 million, or 1.5%, compared to the prior-year period. The decrease in net sales for the quarter ended March 31, 2026 primarily reflects lower Resourcive sales. For the nine months ended March 31, 2026, net sales increased $1.3 million, or 1.7%, compared to the prior-year periods. The increase in net sales for the nine months ended March 31, 2026 primarily reflects higher Intelisys sales. Excluding the impact of acquisitions, adjusted net sales increased $0.5 million, or 0.7%, for the nine months ended March 31, 2026. Quarterly annualized net billings for Intelisys totaled approximately $2.88 billion.

Current wording

The Intelisys & Solution Services segment consists of sales and services to channel partners and end-users in the United States and Canada. For the quarter ended September 30, 2026, net sales increased $20.8 million, or 85.9%, compared to the prior-year quarter. The increase in net sales includes the acquisition of MicroAge. Excluding the impact of acquisitions, non-GAAP net sales increased $0.8 million, or 3.2%, for the quarter ended September 30, 2026 compared to the prior-year quarter, primarily from Intelisys business growth. Quarterly net billings for Intelisys increased 3.8% over the prior-year quarter to bring annualized net billings to approximately $2.89 billion.

Previous wording

(b) Countries outside of the United States and Brazil represent less than 5.0% of net sales for the quarters and nine months ended March 31, 2026 and 2025.

Current wording

(b) Net sales in Canada are supported by U.S. operations and represent less than 5.0% of net sales for the quarters ended September 30, 2026 and 2025.

Previous wording

The following table summarizes our gross profit for the quarters and nine months ended March 31, 2026 and 2025:

Current wording

The following table summarizes our gross profit for the quarters ended September 30, 2026 and 2025:

Previous wording

Our gross profit is primarily affected by sales volume and gross margin mix. Gross margin mix is impacted by multiple factors, which include sales mix (proportion of sales of higher margin products or services relative to total sales), supplier program recognition (consisting of volume rebates, inventory price changes and purchase discounts) and freight costs. Increases in supplier program recognition decrease cost of goods sold, thereby increasing gross profit. Gross profit margin in our Intelisys & Advisory segment reflects a higher contribution of recurring revenue which is recorded on a net basis.

Current wording

Our gross profit is primarily affected by sales volume and gross margin mix. Gross margin mix is impacted by multiple factors, which include sales mix (proportion of sales of higher margin products or services relative to total sales), supplier program recognition (consisting of volume rebates, inventory price changes and purchase discounts) and freight costs. Increases in supplier program recognition decrease cost of goods sold, thereby increasing gross profit. Gross profit margin in our Intelisys & Solution Services segment has historically been significantly higher than our Specialty Technology Solutions segment due toa larger contribution of recurring revenue which is recorded on a net basis. With the acquisition of MicroAge into the Intelisys & Solution Services segment, we are introducing a different sales mix that includes hardware, software and services recorded on a gross basis.

Previous wording

For the quarter ended March 31, 2026, gross profit dollars for the Specialty Technology Solutions segment increased $7.4 million, or 10.0%, compared to the prior-year quarter. Higher sales volumes, after considering cost of goods sold, increased gross profit by $6.8 million, and favorable supplier recognition program increased gross profit by $0.6 million. Gross profit margin increased slightly over the prior-year quarter to 11.0%.

Current wording

For the quarter ended September 30, 2026, gross profit dollars for the Specialty Technology Solutions segment increased $2.7 million, or 3.2%, compared to the prior-year quarter. Higher sales volumes, after considering cost of goods sold, increased gross profit by $23.7 million. Sales mix reduced gross profit by $21.0 million for the quarter. Gross profit margin decreased 229 basis points over the prior-year quarter to 9.4%.

Previous wording

The following table summarizes our operating expenses for the quarters and nine months ended March 31, 2026 and 2025:

Current wording

The following table summarizes our operating expenses for the quarters ended September 30, 2026 and 2025:

Previous wording

Selling, general and administrative expenses (“SG&A”) increased by $8.4 million, or 12.0%, and$16.1 million, or 7.5%, for the quarter andnine months ended March 31, 2026, respectively, compared to the prior-year periods. The increase for the quarter andnine months ended March 31, 2026 is primarily attributable to increased costs for employee-related expenses and costs related to acquisitions. SG&A includes customer specific bad debt expenses in Brazil for the nine months ended March 31, 2026.

Current wording

Selling, general and administrative expenses (“SG&A”) increased by $21.2 million, or 28.2%, for the quarter ended September 30, 2026, compared to the prior-year quarter. The increase for the quarter ended September 30, 2026 is primarily attributable to increased employee-related expenses and costs related to acquisitions. In addition, SG&A includes approximately $4.5 million of higher bad debt expenses, primarily related to specific customer credit exposures in Brazil.

Previous wording

Restructuring and other charges of$5.4 million were incurred in thenine months ended March 31, 2025. Restructuring and other charges relate to employee separation and benefit costs in connection with our expense reduction and restructuring plans implemented during the prior fiscal year.

Current wording

Restructuring expense incurred in thequarter ended September 30, 2026 relate to employee separation and benefit costs in connection with our expense reduction and restructuring plan.

Previous wording

We present changes in fair value of the contingent consideration owed to the former shareholders of businesses that we acquire as a separate line item in operating expenses. We recorded a fair value adjustment expense of $0.4 million and $2.0 million in thequarter and nine months ended March 31, 2026, respectively. The expense from changes in fair value of contingent consideration for the quarter and nine months ended March 31, 2026 is largely due to the recurring amortization of the unrecognized fair value discount.

Current wording

We present changes in fair value of the contingent consideration owed to the former shareholders of businesses that we acquire as a separate line item in operating expenses. We recorded a fair value adjustment of $0.1 million in the quarter ended September 30, 2026 largely due to changes in forecasted results, partially offset by the recurring amortization of the unrecognized fair value discount. Comparatively, we recorded expense of $0.3 million in the prior-year quarter largely due to the recurring amortization of the unrecognized fair value discount.

Previous wording

The following table summarizes our operating income for the quarters and nine months ended March 31, 2026 and 2025:

Current wording

The following table summarizes our operating income for the quarters ended September 30, 2026 and 2025:

Previous wording

For the Specialty Technology Solutions segment, operating income increased $0.8 million, or 5.9%, and $1.4 million, or 3.1%, for the quarter and nine months ended March 31, 2026, respectively, compared to the prior-year periods. Operating margin was 2.0% and 2.1% for the quarter and nine months ended March 31, 2026, respectively. The increase in operating income for the quarter and nine months ended March 31, 2026 is primarily due to higher gross profits.

Current wording

For the Intelisys & Solution Services segment, operating income increased $2.4 million, or 42.1%, for the quarter ended September 30, 2026, compared to the prior-year quarter. Operating margin was 18.4% and 24.0%for thequarters ended September 30, 2026 and 2025, respectively. The increase in operating income for the quarter is primarily due to the MicroAge acquisition. The decrease in operating margin reflects a higher mix of hardware, software, and services as a result of the acquisition.

Previous wording

For the quarter and nine months ended March 31, 2026, Corporate operating losses of $0.2 million and $1.1 million, respectively, primarily represents acquisition-related costs. For the quarter and nine months ended March 31, 2025, Corporate operating losses of $0.3 million and $7.9 million, respectively, represent restructuring, acquisition-related costs and a legal settlement incurred in December 2024.

Current wording

For the quarter ended September 30, 2026, Corporate operating losses of $6.0 million represents $4.4 million of acquisition-related costs and $1.6 million of restructuring costs. For the quarter ended September 30, 2025, Corporate operating losses of $0.3 million largely represent acquisition-related costs.

Previous wording

The following table summarizes our total other (income) expense for the quarters and nine months ended March 31, 2026 and 2025:

Current wording

The following table summarizes our total other (income) expense for the quarters ended September 30, 2026 and 2025:

Previous wording

Interest expense consists primarily of interest incurred on borrowings, non-utilization fees charged on the revolving credit facility and amortization of debt issuance costs. Interest expense decreased for the quarter and nine months ended March 31, 2026 compared to the prior-year periods, primarily from lower average borrowings on our term loan credit facility and lower interest rates.

Current wording

Interest expense consists primarily of interest incurred on borrowings, non-utilization fees charged on the revolving credit facility and amortization of debt issuance costs. Interest expense increased for the quarter ended September 30, 2026 compared to the prior-year quarter, primarily from higher average borrowings on our multi-currency revolving credit facility.

Previous wording

Net foreign exchange gains and losses consist of foreign currency transactional and functional currency re-measurements, which are offset by net foreign exchange forward contracts gains and losses. Foreign exchange gains and losses are primarily generated as the result of fluctuations in the value of the U.S. dollar versus the Brazilian real and the Canadian dollar versus the U.S. dollar. We partially offset foreign currency exposure with the use of foreign exchange contracts to hedge against these exposures. The costs associated with foreign exchange forward contracts are included in the net foreign exchange losses.

Current wording

Net foreign exchange gains and losses consist of foreign currency transactional and functional currency re-measurements, offset by net foreign exchange forward contracts gains and losses. Foreign exchange gains and losses are generated as the result of fluctuations in the value of the U.S. dollar versus the Brazilian real, the Canadian dollar versus the U.S. dollar, the euro versus the U.S. dollar, and the British pound versus the U.S. dollar. We partially offset foreign currency exposure with the use of foreign exchange contracts to hedge against these exposures. The costs associated with foreign exchange forward contracts are included in the net foreign exchange losses.

Previous wording

For the quarter and nine months ended March 31, 2026, income tax expense was $7.2 million and $17.2 million, respectively, reflecting an effective tax rate of 29.8% and 24.4%, respectively. In comparison, for the quarter and nine months ended March 31, 2025, income tax expense was $6.8 million and $15.4 million, respectively, reflecting an effective tax rate of 28.0% and 23.1%, respectively. We expect the effective tax rate, excluding discrete items, for fiscal year 2026 to be approximately 27.9% to 28.2%. See Note 13 - Income Taxes to the Notes to Consolidated Financial Statements for further discussion.

Current wording

For the quarter ended September 30, 2026, income tax expense was $3.2 million reflecting an effective tax rate of 27.1%. In comparison, for the quarter ended September 30, 2025, income tax expense was $7.1 million reflecting an effective tax rate of 26.4%. See Note 13 - Income Taxes to the Notes to Consolidated Financial Statements for further discussion.

Previous wording

(a)The annualized EBITDA amount is divided by days in the quarter times 365 days per year, or 366 days for leap year. There were 90 days in the current and in the prior-year quarter.

Current wording

(a)The annualized EBITDA amount is divided by days in the quarter times 365 days per year, or 366 days for leap year. There were 92 days in the current and in the prior-year quarter.

Previous wording

(c)The annualized adjusted EBITDA amount is divided by days in the quarter times 365 days per year, or 366 days for a leap year. There were 90 days in the current quarter and the prior-year quarter.

Current wording

(c)The annualized adjusted EBITDA amount is divided by days in the quarter times 365 days per year, or 366 days for a leap year. There were 92 days in the current quarter and the prior-year quarter.

Previous wording

Our cash and cash equivalents balance totaled $120.3 million at March 31, 2026, compared to $126.2 million at June 30, 2025, including $33.8 million and $46.3 million held outside of the United States at March 31, 2026 and June 30, 2025, respectively. Checks released but not yet cleared in the amount of $0.2 million and $0.1 million are included in accounts payable at March 31, 2026 and June 30, 2025, respectively.

Current wording

Cash and cash equivalents balance totaled $45.9 million at September 30, 2026, compared to $88.4 million at June 30, 2026, including $32.6 million and $35.4 million held outside of the United States at September 30, 2026 and June 30, 2026, respectively. Checks released but not yet cleared in the amount of $0.2 million and $0.1 million are included in accounts payable at September 30, 2026 and June 30, 2026, respectively.

Previous wording

Our net investment in working capital, defined as accounts receivable plus inventories less accounts payable, decreased $52.3 million to $468.4 million at March 31, 2026 from $520.7 million at June 30, 2025, as a result of an increase in accounts payable and a decrease in accounts receivable. Our netinvestment in working capital is affected by several factors such as fluctuations in sales volume, net income, timing of collections from channel sales partners, increases and decreases to inventory levels, and payments to vendors.

Current wording

Our net investment in working capital, defined as accounts receivable plus inventories less accounts payable, increased $49.6 million to $588.5 million at September 30, 2026 from $538.8 million at June 30, 2026, primarily from an increase in accounts receivable and inventories partially offset by an increase in accounts payable. Our net investment in working capital is affected by several factors such as fluctuations in sales volume, net income, timing of collections from channel sales partners, increases and decreases to inventory levels, and payments to vendors.

Previous wording

Operating cash flows are subject to variability period over period as a result of the timing of payments related to accounts receivable, accounts payable, and other working capital items. Net cash provided by operating activities was $125.4 million and $104.7 million for the nine months ended March 31, 2026 and March 31, 2025, respectively. Cash provided by operating activities for the nine months ended March 31, 2026 is primarily attributable to net income and changes in working capital balances. Compared to March 31, 2025, accounts payable and accounts receivable increased 19.6% and 11.7%, respectively.

Current wording

Operating cash flows are subject to variability period over period as a result of the timing of payments related to accounts receivable, accounts payable, and other working capital items. Net cash used in operating activities was $42.3 million for the three months ended September 30, 2026 compared to net cash provided by operating activities of $23.2 million for the three months ended September 30, 2025. Cash used in operating activities for the three months ended September 30, 2026 is primarily attributable to changes in working capital balances. Compared to September 30, 2025, accounts payable and accounts receivable increased 46.3% and 46.4%, respectively.

Previous wording

The number of days sales outstanding ("DSO") was 74 days at March 31, 2026, compared to 70 days at June 30, 2025 and 72 days at March 31, 2025. Inventory turned 5.4 times during the quarter ended March 31, 2026, compared to 5.9 times during the quarter ended June 30, 2025 and 5.0 times in the prior-year quarter ended March 31, 2025.

Current wording

The number of days sales outstanding ("DSO") was 76 days at September 30, 2026, compared to 73 days at June 30, 2026 and 68 days at September 30, 2025. Inventory turned 6.3 times during the quarter ended September 30, 2026, compared to 6.6 times during the quarter ended June 30, 2026 and 5.1 times in the prior-year quarter ended September 30, 2025.

Previous wording

Cash used in investing activities for the nine months ended March 31, 2026 was $25.0 million, compared to cash used in investing activities of $59.9 million in the prior-year period. Cash used in investing activities for the nine months ended March 31, 2026 represents cash paid for acquisitions and capital expenditures. Cash used in investing activities for the nine months ended March 31, 2025 represents cash paid for acquisitions and capital expenditures offset by cash received for disposal of business.

Current wording

Cash used in investing activities for the three months ended September 30, 2026 and 2025 was $219.6 million and $2.4 million, respectively. Cash used in investing activities for the three months ended September 30, 2026 represents cash paid for acquisitions and capital expenditures. Cash used in investing activities for the three months ended September 30, 2025 represents cash paid for capital expenditures.

Previous wording

Management expects capital expenditures for fiscal year 2026 to range from $8.0 million to $10.0 million, primarily for IT and warehouse investments.

Current wording

Management expects capital expenditures for fiscal year 2027 to range from $8.0 million to $12.0 million, primarily for IT and warehouse investments.

Previous wording

For the nine months ended March 31, 2026 and March 31, 2025, cash used in financing activities totaled $107.0 million and $83.4 million, respectively. Cash used in financing activities for the nine months ended March 31, 2026 represents common stock repurchases and repayments on long-term debt. Cash used in financing activities for the nine months ended March 31, 2025 is primarily attributable to common stock repurchases.

Current wording

For the three months ended September 30, 2026 cash provided by financing activities totaled $219.5 million compared to cash used in financing activities of $23.0 million for the three months ended September 30, 2025. Cash provided by financing activities for the three months ended September 30, 2026 represents borrowings on our revolving line of credit. Cash used in financing activities for the three months ended September 30, 2025 is primarily attributable to common stock repurchases.

Previous wording

On December 18, 2025, the Company entered into a credit agreement (the “New Credit Agreement”) with PNC Bank, National Association, as administrative agent (“PNC”), and the other lenders party thereto (the “Lenders”), providing for (i) a five-year, $400 million multicurrency senior secured revolving credit facility and (ii) a five-year $100 million senior secured term loan facility (the “New Credit Facilities”). In addition, pursuant to an “accordion feature,” the Company may increase its borrowings by up to the greater of $250 million or 150% of the Company’s EBITDA calculated on a Pro Forma Basis (each as defined in the New Credit Agreement), subject to obtaining additional credit commitments from the Lenders participating in the increase. The New Credit Agreement allows for issuance of up to $50 million for letters of credit. Borrowings under the New Credit Agreement are secured by substantially all of the assets of the Company and its domestic subsidiaries. Under the terms of the revolving credit facility, the payment of cash dividends is restricted. The Company incurred debt issuance costs of $1.4 million in connection with the New Credit Agreement. These costs were capitalized to other non-current assets on the Condensed Consolidated Balance Sheets and added to the unamortized debt issuance costs from the previous credit facility.

Current wording

On December 18, 2025, we entered into a credit agreement (the “New Credit Agreement”) with PNC Bank, National Association, as administrative agent (“PNC”), and the other lenders party thereto (the “Lenders”), providing for (i) a five-year, $400 million multicurrency senior secured revolving credit facility and (ii) a five-year $100 million senior secured term loan facility (the “New Credit Facilities”). In addition, pursuant to an “accordion feature,” we may increase our borrowings by up to the greater of $250 million or 150% of our EBITDA calculated on a Pro Forma Basis (each as defined in the New Credit Agreement), subject to obtaining additional credit commitments from the Lenders participating in the increase. The New Credit Agreement allows for issuance of up to $50 million for letters of credit. Borrowings under the New Credit Agreement are secured by substantially all of our assets and those of our domestic subsidiaries. Under the terms of the revolving credit facility, the payment of cash dividends is restricted. We incurred debt issuance costs of $1.4 million in connection with the New Credit Agreement, which were capitalized to other non-current assets on the Condensed Consolidated Balance Sheets and added to the unamortized debt issuance costs from the previous credit facility.

Previous wording

Loans denominated in U.S. dollars, other than swingline loans, bear interest at a rate per annum equal to, at the Company’s option, (i) the Term Secured Overnight Financing Rate ("SOFR") or daily simple SOFR plus an additional margin ranging from 1.00% to 1.75% depending upon the Company’s ratio of (A) total consolidated debt less its unrestricted domestic cash to (B) trailing four-quarter consolidated EBITDA measured as of the end of the most recent year or quarter, as applicable, for which financial statements have been delivered to the Lenders (the “leverage ratio”); or (ii) the base rate plus an additional margin ranging from 0% to 0.75%, depending upon the Company’s leverage ratio. All swingline loans denominated in U.S. dollars bear interest based upon the daily simple SOFR, floating daily, plus an additional margin ranging from 1.00% to 1.75% depending upon the Company's leverage ratio, or such other rate as the Company and the applicable swingline lender may agree. Loans denominated in foreign currencies bear interest at a rate per annum equal to the applicable benchmark rate set forth in the New Credit Agreement plus an additional margin ranging from 1.00% to 1.75%, depending upon the Company’s leverage ratio. A commitment fee is payable on the unused amount of commitments under the revolving credit facility. The commitment fee ranges from 0.15% to 0.30%, depending on the Company’s leverage ratio.

Current wording

Loans denominated in U.S. dollars, other than swingline loans, bear interest at a rate per annum equal to, at our option, (i) the Term Secured Overnight Financing Rate ("SOFR") or daily simple SOFR plus an additional margin ranging from 1.00% to 1.75% depending upon our ratio of (A) total consolidated debt less its unrestricted domestic cash to (B) trailing four-quarter consolidated EBITDA measured as of the end of the most recent year or quarter, as applicable, for which financial statements have been delivered to the Lenders (the “leverage ratio”); or (ii) the base rate plus an additional margin ranging from 0% to 0.75%, depending upon our leverage ratio. All swingline loans denominated in U.S. dollars bear interest based upon the daily simple SOFR, floating daily, plus an additional margin ranging from 1.00% to 1.75% depending upon our leverage ratio, or such other rate as we and the applicable swingline lender may agree. Loans denominated in foreign currencies bear interest at a rate per annum equal to the applicable benchmark rate set forth in the New Credit Agreement plus an additional margin ranging from 1.00% to 1.75%, depending upon our leverage ratio. A commitment fee is payable on the unused amount of commitments under the revolving credit facility. The commitment fee ranges from 0.15% to 0.30%, depending on our leverage ratio.

Previous wording

In connection with entering into the New Credit Agreement, on December 18, 2025, the Company terminated and repaid all indebtedness and other obligations outstanding under its Third Amended and Restated Credit Agreement (the “Prior Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent, and the other lenders party thereto, which provided for (i) a five-year, $350 million multicurrency senior secured revolving credit facility and (ii) a five-year $150 million senior secured term loan facility.

Current wording

In connection with entering into the New Credit Agreement, on December 18, 2025, we terminated and repaid all indebtedness and other obligations outstanding under our Third Amended and Restated Credit Agreement (the “Prior Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent, and the other lenders party thereto, which provided for (i) a five-year, $350 million multicurrency senior secured revolving credit facility and (ii) a five-year $150 million senior secured term loan facility.

Previous wording

During the quarter and nine months ended March 31, 2026, all of the Company's borrowings under New Credit Agreement and Prior Credit Agreement were U.S. dollar loans. The spread in effect as of March 31, 2026 was 1.00% for SOFR-based loans and 0.00% for alternate base rate loans. The commitment fee rate in effect at March 31, 2026 was 0.15%. The effective interest rates for the term loan were 4.67% and 5.43% as of March 31, 2026 and June 30, 2025, respectively. The New Credit Agreement includes customary representations, warranties and affirmative and negative covenants, including financial covenants. Specifically, the Company’s leverage ratio must be less than or equal to 3.50 to 1.00. In addition, the Company’s Interest Coverage Ratio (as such term is defined in the New Credit Agreement) must be at least 3.00 to 1.00 at the end of each fiscal quarter. In the event of a default, customary remedies are available to the lenders, including acceleration and increased interest rates. The Company was in compliance with all covenants under the New Credit Agreement at March 31, 2026.

Current wording

During the quarter ended September 30, 2026, all of our borrowings under New Credit Agreement and Prior Credit Agreement were U.S. dollar loans. The spread in effect as of September 30, 2026 was 1.00% for SOFR-based loans and 0.00% for alternate base rate loans. The commitment fee rate in effect at September 30, 2026 was 0.15%. The effective interest rates for the term loan were 4.91% and 4.65% as of September 30, 2026 and June 30, 2026, respectively. The New Credit Agreement includes customary representations, warranties and affirmative and negative covenants, including financial covenants. Specifically, our leverage ratio must be less than or equal to 3.50 to 1.00. In addition, our Interest Coverage Ratio (as such term is defined in the New Credit Agreement) must be at least 3.00 to 1.00 at the end of each fiscal quarter. In the event of a default, customary remedies are available to the lenders, including acceleration and increased interest rates. We were in compliance with all covenants under the New Credit Agreement at September 30, 2026.

Previous wording

The average daily outstanding balance on the revolving credit facility, excluding the term loan facility, was $1.2 million and $0.3 million during the nine-month periods ended March 31, 2026 and 2025, respectively. There was $400.0 million and $350.0 million available for additional borrowings as of March 31, 2026 and June 30, 2025, respectively. The effective interest rates for the revolving line of credit were 4.65% and 5.46% as of March 31, 2026 and June 30, 2025, respectively. There were no letters of credit issued under the multi-currency revolving credit facility as of March 31, 2026 and June 30, 2025.

Current wording

The average daily outstanding balance on the revolving credit facility, excluding the term loan facility, was $139.9 million and $1.1 million during the three month periods ended September 30, 2026 and 2025, respectively. There was $168.1 million and $400.0 million available for additional borrowings as of September 30, 2026 and June 30, 2026, respectively. The effective interest rates for the revolving line of credit were 4.90% and 4.62% as of September 30, 2026 and June 30, 2026, respectively. There were no letters of credit issued under the multi-currency revolving credit facility as of September 30, 2026 and June 30, 2026.