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Esterline upsizes revolver, extends maturity, repays 6.77% notes
By Angela McDaniels
Seattle, Nov. 18 - Esterline Technologies Corp. increased the size of its secured revolving credit facility to $100 million from $60 million and extended the maturity to 2010 from 2008, according to an 8-K report filed on Friday with the Securities and Exchange Commission. The company also said it repaid its 6.77% series C senior notes due 2008.
The Nov. 14 amendment to the credit facility also increased the permitted amount of subordinated debt the company can incur to $235 million from $15 million.
Other changes include:
• Reduction of the fee payable on the unused balance of the revolver to a range of 12.5 to 25 basis points from a range of 35 to 50 basis points, depending on the company's leverage ratio;
• Reduction of the interest rate margin on borrowings;
• Easing of restrictions so the company may now declare and pay dividends or acquire shares for cash up to a total of $10 million per 12-month period;
• Increase in the maximum leverage ratio to 4 to 1;
• Addition a covenant that requires a minimum interest coverage ratio of 3 to 1;
• Elimination of financial covenants relating to total debt to capitalization and minimum net worth.
Wachovia Bank is administrative agent to the amendment.
On Nov. 15, the company exercised its option to prepay the outstanding principal amount of its $40 million 6.77% series C notes. Under the terms of the purchase agreement, Esterline paid an additional $1,983,920 to the noteholders as the make-whole amount, the company said.
Esterline is a manufacturing company serving the aerospace and defense markets and is based in Bellevue, Wash.
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