Vought Aircraft amendment includes revolver reduction and bank debt repayments

By Sara Rosenberg

New York, July 9 -Vought Aircraft Industries Inc. came out with additional details on its amendment proposal as a call was held on Thursday to discuss the transaction with lenders, according to a market source.

The main purpose of the amendment is to waive the $30 million annual cap on asset sales so that the company can move forward with the sale of its South Carolina operations to Boeing for about $580 million in cash.

However, the amendment also calls for the downsizing of the revolver to $100 million from $150 million, the source said.

In addition, as part of the amendment, the company would use $305 million of the asset sale proceeds to repay term loan B and incremental term loan debt on a pro rata basis, $135 million would be used to pay down revolver borrowings, $100 million would be used to fund a pension plan, and $40 million would be used for cash on the balance sheet and/or to pay expenses related to the amendment and asset sale.

As a result of the paydowns, secured leverage would go to 1.5 times from 3.0 times.

The amendment would also give the company the ability to, at a later date, extend the December 2010 revolver maturity and December 2011 term loan B and incremental term loan maturity, the source remarked.

Lastly, the amendment would change the administrative agent to Barclays from Lehman.

Barclays is leading the amendment process.

Consents are due on July 17.

Lenders are being offered a 5 basis point amendment fee.

Vought Aircraft is a Dallas-based aerostructures company.

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