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Aleris International amends credit agreement’s debt provisions
By Marisa Wong
Morgantown, W.Va., Dec. 28 – Aleris International, Inc. entered into a third amendment on Dec. 22 to its credit agreement dated June 15, 2015 with JPMorgan Chase Bank, NA as administrative agent, J.P. Morgan Europe Ltd. as European agent, Bank of America, NA as syndication agent and Barclays Bank plc and Deutsche Bank Securities Inc. as syndication agents, according to an 8-K filed Thursday with the Securities and Exchange Commission.
The amendment modifies some provisions of the ABL facility to, among other things, permit indebtedness of foreign subsidiaries, provided that the total amount of debt incurred by foreign subsidiaries that are loan parties does not exceed the greater of $175 million and 10% of consolidated assets.
The amendment also modifies provisions relating to the incurrence of additional secured debt. Debt incurred on or after the amendment date and on or before Dec. 31, 2018 is permitted if, when taken together with the aggregate principal amount of all loans and the aggregate face value of all letters of credit then outstanding, the amount does not exceed the greatest of (a) $750 million, (b) the sum of (i) 85% of the net book value of accounts receivable of Aleris and its subsidiaries and (ii) 70% of the net book value of inventory of Aleris and its subsidiaries and (c) 3.5 times adjusted EBITDA on a consolidated basis for the most recently ended four full quarters.
In addition, the amendment permits up to $80 million of liens encumbering any property (other than collateral) to support liabilities or deferred revenues.
Aleris is a Cleveland-based producer of aluminum products.
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