Powell Industries, Inc. Enters into an Amended and Restated Credit Agreement
October 11, 2023 at 04:47 pm EDT
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As previously disclosed, on September 27, 2019, Powell Industries, Inc. (the ?Company?), together with certain of its direct subsidiaries, entered into an Amended and Restated Credit Agreement (as amended, the ?U.S. Revolver?) with the lenders party thereto, Bank of America, N.A., as Administrative Agent, Swingline Lender and L/C Issuer (?Bank of America?), and BofA Securities, Inc, as Sole Lead Arranger and Sole Bookrunner. On October 4, 2023, the Company, together with certain of its direct subsidiaries, entered into a third amendment to the U.S. Revolver (the ?Third Amendment?) with the lenders party thereto and Bank of America, as Administrative Agent, Swingline Lender, L/C Issuer and a Lender. The Third Amendment amended the U.S. Revolver by, among other things, (i) increasing the amount of the revolving line of credit extended to the Company thereunder from $125,000,000 to $150,000,000, (ii) adding Texas Capital Bank as Syndication Agent and a lender, (iii) amending certain terms related to the calculation of the Company?s consolidated net leverage ratio to provide that up to $60,000,000 may be deducted from the Company?s consolidated funded indebtedness, which is a component of the consolidated net leverage ratio, based on the lesser of the amount of letters of credit outstanding (not to be less than zero) and 60% of the Company?s available, unencumbered cash, (iv) adding certain terms related to a specified cash collateral trigger event in the event a customer files a claim for indemnity, performance or payment in an amount equal to or greater than $40,000,000 under an applicable surety bond as a result of a breach under the underlying contract, (v) decreasing the SOFR Adjustment (as defined in the U.S. Revolver) to 0.10% (10 basis points), and (vi) amending the financial covenant relating to the Company?s liquidity to require the maintenance of no less than $60,000,000 of liquidity.
Powell Industries, Inc. develops, designs, manufactures and services custom-engineered equipment and systems. The Company distributes, controls and monitors the flow of electrical energy and provides protection to motors, transformers and other electrically powered equipment. Its principal products include integrated power control room substations (PCRs), custom-engineered modules, electrical houses (E-Houses), traditional and arc-resistant distribution switchgear and control gear, medium-voltage circuit breakers, monitoring and control communications systems, motor control centers, switches and bus duct systems. Its products are designed for application voltages ranging from approximately 480 volts to 38,000 volts and are used in oil and gas refining, onshore and offshore oil and gas production, petrochemical, liquefied natural gas (LNG) terminals, pipeline, terminal, mining and metals, light rail traction power, electric utility, pulp and paper and other industrial markets.