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Hexcel signs for $750 million revolver at SOFR plus 112.5 bps
By Mary-Katherine Stinson
Lexington, Ky., April 28 – Hexcel Corp. entered a new credit agreement on April 25 for a $750 million revolving credit facility with Citizens Bank, NA as administrative agent, which matures April 25, 2028, according to an 8-K filing with the Securities and Exchange Commission.
The agreement allows Hexcel to increase the total amount up to $500 million through adding term loans or increasing the revolving commitment.
Up to $50 million of the revolver may be used for letters of credit.
Borrowings will bear interest at SOFR plus 10 basis points CSA plus an applicable margin, subject to a 0% SOFR floor.
The applicable margin initially is 112.5 bps for SOFR rate borrowings. The rate can fluctuate, as it is based on the company’s public debt rating and consolidated leverage ratio, whichever is most favorable to Hexcel. The pricing grid based on ratings is 87.5 bps to 150 bps.
The commitment fee will be between 10 bps and 22.5 bps. Initially, it is 15 bps.
Revolving loans may be borrowed, repaid and re-borrowed.
Financial covenants require Hexcel to maintain a minimum interest coverage ratio and a maximum consolidated net leverage ratio.
Joining Citizens Bank as joint lead arrangers, bookrunners and syndication agents are BofA Securities, Inc., TD Bank, NA, JPMorgan Chase Bank, NA and U.S. Bank NA.
Goldman Sachs Bank USA, PNC Bank, NA and BNP Paribas are co-documentation agents.
At closing, $60 million was drawn down and used to repay and terminate Hexcel’s existing credit agreement from Sept. 28, 2020 which was set to expire June 20,2024. There were no early termination penalties.
Hexcel is a composites company based in Stamford, Conn.
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