Diodes subsidiary enters $100 million two-year revolving facility

By Marisa Wong

Los Angeles, Jan. 26 – Diodes Inc. subsidiary Diodes Hong Kong Ltd. entered into a facility agreement on Jan. 22 with Hongkong and Shanghai Banking Corp. Ltd. as arranger for a $100 million revolving loan, according to an 8-K filing with the Securities and Exchange Commission.

The facility matures on Jan. 22, 2023. The availability period extends from Jan. 22, 2021 through Dec. 22, 2022.

The interest rate is Libor plus a margin of 125 basis points if the consolidated leverage ratio is less than 1.50 to 1. The margin increases on a sliding scale as the consolidated leverage ratio increases, up to a maximum of 225 bps if the ratio is greater than 3.00 to 1.

The non-utilization fee payable on the undrawn amount is also dependent upon the consolidated leverage ratio. The fee is 15 bps if the ratio is less than 1.50 to 1 and increases, on a sliding scale, up to a maximum of 35 bps if the ratio is greater than or equal to 3.00 to 1.

The agreement contains some financial and non-financial covenants, including a maximum leverage ratio, a minimum tangible net worth, a minimum interest cover ratio and restrictions on payments of dividends.

The borrower plans to use a portion of the loan proceeds to refinance existing debt and to finance working capital requirements and general corporate purposes.

Diodes is a semiconductor manufacturing company based in Plano, Tex.

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