v3.25.4
Financial Instruments
 12 Months Ended
Dec. 31, 2025
Debt Disclosure [Abstract]  
Financial Instruments Financial Instruments
Long-term debt consisted of the following as of December 31:
2025 Credit Agreement20252019 Credit and Guaranty Agreement2024
2025 Term Loan$296,250 Amended Term Loan$337,864 
Less:Less:
Current portion of long-term debt(15,000)Current portion of long-term debt(27,339)
Unamortized debt issuance cost(570)Unamortized debt issuance cost(1,147)
Unamortized discount(1,729)Unamortized discount(1,090)
$278,951 $308,288 
2025 Credit Agreement
On July 31, 2025, the Company entered into a Credit Agreement (the “2025 Credit Agreement”) with Wells Fargo Bank, National Association, and a syndicate of financial institutions and other entities (collectively, the “Lenders”). The 2025 Credit Agreement consists of a $300,000 term loan facility (the “2025 Term Loan”) and a $100,000 revolving credit facility (the “2025 Revolver” and, together with the 2025 Term Loan, the “2025 Term Loan Facilities”).
Proceeds from the 2025 Term Loan, borrowings of $30,000 under the 2025 Revolver, and $2,562 in available cash were used to repay the outstanding balance under the 2019 Credit and Guaranty Agreement, as amended, which totaled $332,562 as of July 31, 2025 and is further described below under Amended Term Loan.
The Company accounted for the repayment of the outstanding balance under the 2019 Credit and Guaranty Agreement on a creditor-by-creditor basis. With respect to the continuing creditors, the Company accounted for these transactions as debt modifications; with respect to the new lender, the Company accounted for this transaction as an issuance of new debt; and with respect to exiting creditors, the Company accounted for these transactions as debt extinguishments.
As a result of the 2025 Credit Agreement, the Company received cash proceeds of $28,125 from a new creditor and $5,078, net of repayments, from several continuing creditors. In connection with the termination of the 2019 Credit and Guaranty Agreement, the Company paid $65,765, primarily to exiting creditors, with a portion paid to a continuing creditor that was partially extinguished. The Company recorded an original issue discount of $1,296 related to the 2025 Credit Agreement, which was capitalized within the consolidated balance sheets. These capitalized discounts are amortized as interest expense, net, on a straight-line basis over the term of the 2025 Term Loan Facilities, which approximates the effective interest method. The majority of the capitalized discounts originated from loans with continuing creditors.
The Company recognized a loss on extinguishment of $326, which is included in the consolidated statement of operations and comprehensive income (loss) for the year ended December 31, 2025. This loss reflects the write-off of unamortized deferred financing costs and discounts associated with certain financial institutions under the 2019 Credit and Guaranty Agreement.
The Company also incurred $794 in third-party costs associated with the debt modification, which were expensed as incurred and recorded within selling, general and administrative expense within the consolidated statement of operations and comprehensive income (loss) for the year ended December 31, 2025.
As of December 31, 2025, the outstanding balance on the 2025 Term Loan was $293,951, net of discount of $1,729 and deferred financing costs of $570. These amounts include portions of the original issue discounts and deferred financing costs attributable to returning Lenders from the 2019 Credit and Guaranty Agreement. Interest expense, net includes deferred cost amortization of $1,161, $1,524 and $1,706 for the years ended December 31, 2025, 2024 and 2023, respectively. The effective interest rate on the 2025 Term Loan was 6.09% as of December 31, 2025.
The 2025 Term Loan and 2025 Revolver mature on July 31, 2030 (“Maturity”). On December 31, 2025, the Company paid $3,750 of principal related to the 2025 Term Loan. As of December 31, 2025, scheduled principal payments for the 2025 Term Loan are as follows :
PeriodScheduled Quarterly PaymentsAnnually
2026$3,750 $15,000 
20273,750 15,000 
20283,750 15,000 
20293,750 15,000 
20303,750 7,500 
2030 - Final payment at Maturity— 228,750 
The estimated fair value of the 2025 Term Loan, using the midpoint of the Bloomberg Valuation, was $286,252 as of December 31, 2025. This is classified as a Level 2 instrument within the fair value hierarchy.
Interest - 2025 Credit Agreement
The 2025 Term Loan and the 2025 Revolver permit the Company to elect either the Secured Overnight Financing Rate (“SOFR”) or the Base Rate (“BR”) option for all or portions of the borrowings. Both rate options are calculated using a base interest rate plus a margin, which is determined based on the Company’s leverage ratio—defined as the ratio of consolidated net indebtedness to consolidated EBITDA, as specified in the 2025 Credit Agreement.
BR borrowings accrue interest based on the Federal Funds Rate plus 0.50%, with interest payments due on the last day of each calendar quarter. SOFR borrowings accrue interest over a designated interest period (“Interest Period”) of one, three or six months at the Company’s discretion. Interest is payable on the last day of each Interest Period, or every three months for Interest Periods longer than three months. The applicable interest margins under the 2025 Credit Agreement are 2.50% and 1.50% for SOFR and BR loans, respectively.
The applicable interest margin is subject to adjustment based on a pricing grid, which reflects changes in the Company’s leverage ratio following delivery of quarterly financial statements to the Lenders:
Leverage ratioSOFRBRCommitment Fee
< 2.00 to 1.00
1.75 %0.75 %0.20 %
≥ 2.00 to 1.00 < 2.50 to 1.00
2.00 %1.00 %0.20 %
≥ 2.50 to 1.00 < 3.00 to 1.00
2.25 %1.25 %0.30 %
≥ 3.00 to 1.00 < 3.50 to 1.00
2.50 %1.50 %0.30 %
≥ 3.50 to 1.00
2.75 %1.75 %0.30 %
Cash paid for interest totaled $27,043, $38,507 and $32,470 for the years ended December 31, 2025, 2024 and 2023, respectively.
2025 Revolver and Letters of Credit
The five-year 2025 Revolver includes an initial annual commitment fee of 0.30%, calculated on the average daily amount of the unused revolving commitment, inclusive of revolving loans, swingline loans, and letters of credit (“LOC”). The commitment fee is payable quarterly in arrears on the last day of each calendar quarter and at Maturity. The commitment fee rate is subject to adjustment based on the Company’s leverage ratio. Swingline loans are available as BR option loans and total LOC availability is limited to $7,500 under the 2025 Credit Agreement.
As of December 31, 2025, the Company had three LOCs outstanding, reducing LOC capacity to approximately $5,300. All outstanding LOCs incur fees equal to the interest margin for SOFR based loans under the 2025 Revolver, applied to the undrawn and unexpired amount of each LOC. These LOC fees are payable quarterly in arrears. In 2025, the Company fully repaid the $30,000 borrowed on its 2025 Revolver. As of December 31, 2025, the Company had $100,000 available under the 2025 Revolver, excluding the effect of outstanding LOCs.
Covenants - 2025 Credit Agreement
The 2025 Credit Agreement contains affirmative and negative covenants applicable to senior secured credit facilities, including covenants that, among other things, limit or restrict the ability of the Company to, subject to negotiated exceptions, incur additional indebtedness, liens on its assets, engage in acquisitions or dispositions, pay dividends or make other distributions, enter into transactions with affiliated persons, make investments, change the nature of its business or organizational documents, or prepay or make modifications to other indebtedness that would adversely affect the Lenders.
The 2025 Credit Agreement also contains financial covenants including a maximum consolidated total net leverage ratio of 4.00 to 1.00 for the fiscal quarter ending December 31, 2025 and starting with the fiscal quarter ending March 31, 2026, and for each fiscal quarter thereafter, a maximum consolidated total net leverage ratio of 3.50 to 1.00. The Company may elect to increase such ratio level by 0.50 to 1.00 following certain permitted acquisitions. A minimum interest coverage ratio of 2.50 to 1.00 must also be maintained. The 2025 Revolver also includes standard provisions related to conditions of borrowing and customary events of default. The Company does not expect any of these covenants or restrictions to affect or limit its ability to conduct business in the ordinary course.
The Company was in compliance with the financial covenants under the 2025 Credit Agreement as of December 31, 2025.
Amended Term Loan
On December 6, 2019, the Company entered into the Credit and Guaranty Agreement (“2019 Credit Agreement”) that consisted of a $200,000 term loan (“Original Term Loan”) and a $50,000 revolving facility (the “Revolver”). The Company amended the 2019 Credit Agreement on August 29, 2021, and then again on October 29, 2021 in connection with the acquisition of Misonix, Inc. in which the Company prepaid $80,000 on the Original Term Loan. The 2019 Credit Agreement, as amended, subsequent to the prepayment, consisted of a $360,750 term loan (“Term Loan”) and the Revolver.
On July 11, 2022, the Company amended the 2019 Credit Agreement in conjunction with the acquisition of CartiHeal (2009) Ltd. (“CartiHeal”). Pursuant to that amendment, an $80,000 term loan facility (the “July 2022 Term Loan” and, together with the Term Loan, the “Term Loan Facilities”) was extended to the Company to be used primarily for the financing of the acquisition of CartiHeal. On March 31, 2023 and January 18, 2024, the Company further amended the 2019 Credit Agreement (collectively, with the prior amendments, the “Amended 2019 Credit Agreement”) to, among other things, modify certain financial covenants, waive covenant noncompliance at December 31, 2022, and modify interest rates applicable to borrowings under the 2019 Credit Agreement.
The January 2024 amendment had deferred financing costs of $1,180, of which $325 was expensed and $855 was capitalized. The March 2023 amendment had deferred financing costs of $3,661, of which $1,617 was expensed and $2,044 was capitalized. There were no losses on debt refinancing and modification as a result of either the January 2024 or March 2023 amendments. Expensed deferred financing costs resulting from the amendments were recorded in selling, general and administrative expense within the consolidated statements of operations and other comprehensive income (loss) and amounts capitalized were recorded primarily in long-term debt, less current portion within the consolidated balance sheets.
As of July 31, 2025, the date of repayment, $331,037 was outstanding on the Term Loan Facilities, net of original issue discount of $743 and deferred financing costs of $782.
Revolver
The Revolver was initially established as a five-year revolving credit facility and was subsequently amended to a four-year term pursuant to the Amended 2019 Credit Agreement. The Revolver’s capacity was reduced by $5,000 on both December 31, 2023 and June 30, 2024 in accordance with the Amended 2019 Credit Agreement, resulting in an aggregate borrowing capacity of $40,000. During the first quarter of 2025, the Company borrowed $15,000 on the Revolver to support working capital needs, which has been fully repaid. The Company had no outstanding borrowings on the Revolver for the year ended December 31, 2024.
Interest Rate Swaps
On August 1, 2025, the Company entered into two interest rate swaps to mitigate the interest rate risk associated with its floating-rate SOFR-based borrowings under the 2025 Credit Agreement. Under the terms of the swaps, the Company pays a fixed interest rate in exchange for SOFR-based variable interest throughout the life of the instruments, the majority of which expire July 31, 2028. The interest rate swaps have a weighted average fixed interest rate of 3.60% and an aggregate notional value of $150,000, or 50.0% of the 2025 Term Loan. Refer to Note 6. Fair Value Measurements for additional information regarding the valuation of the interest rate swaps.