Del Monte amends loan, revising total debt and fixed-charge coverage covenants

By Sara Rosenberg

New York, April 25 - Del Monte Corp. amended its credit facility on Friday, revising the total debt ratio and fixed-charge coverage ratio, according to an 8-K filed with the Securities and Exchange Commission.

The maximum total debt ratio is 5.25:1.00 through Jan. 25, 2009, 4.75:1.00 for May 3, 2009 through Jan. 31, 2010, 4.25:1.00 for May 2, 2010 through Jan. 30, 2011 and 3.75:1.00 for May 1, 2011 and thereafter.

The fixed-charge coverage ratio is set at 1.15:1.00.

In addition, the amendment made it easier for the company to dispose of assets outside the ordinary course of business.

The amendment removed the dollar limitation on asset dispositions and adds a requirement that the company must be in pro forma financial covenant compliance after any disposition is made.

The amendment also requires that 100% of the net cash proceeds from certain major asset dispositions be used to repay bank debt.

Bank of America is the administrative agent on the deal.

Del Monte is a San Francisco-based producer, distributor and marketer of branded food and pet products.

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