KEYW modifies pricing, financial covenants in credit agreement

By Toni Weeks

San Luis Obispo, Calif., March 19 - KEYW Corp. entered into the second amendment to its amended and restated credit agreement on March 13 with Royal Bank of Canada as administrative agent, according to an 8-K filed Wednesday with the Securities and Exchange Commission.

KEYW Holding Corp. is the guarantor for the agreement.

The amendment adds two new pricing tiers to the interest rate spreads. If the consolidated total leverage ratio is greater than 3.00:1 but less than or equal to 3.75:1, the interest rate will be Libor plus 275 basis points. If the total leverage ratio exceeds 3.75:1, the interest rate will be Libor plus 300 bps. The commitment fee will be 50 bps in either case.

The amendment also adjusted KEYW's financial covenants, as follows:

• Increased the maximum consolidated senior leverage ratio for the nine-month period beginning Jan. 1 to 4.00:1, decreased that ratio by 25 bps per calendar quarter and thereafter reset the ratio to the level required in the previous amended and restated credit agreement, 3.00:1, for the remaining time until maturity;

• Increased the maximum consolidated total leverage ratio for the nine-month period beginning Jan. 1 to 4.00:1, decreased that ratio by 25 bps for the third calendar quarter of 2014 and thereafter reset the ratio to the level required in the previous amended and restated credit agreement, 3.50:1, for the remaining time until maturity; and

• Decreased the consolidated fixed-charge coverage ratio for the three-month period from Jan. 1 through March 31 to 1.10:1 and thereafter resetting the ratio to the level required in the previous agreement, 1.25:1, for the remaining time until the maturity date.

KEYW is a Hanover, Md.-based provider of agile cyber superiority, cybersecurity and geospatial intelligence solutions primarily for U.S. Government intelligence and defense customers.

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