Kimball enters into amended, restated $75 million credit agreement

By Sarah Lizee

Olympia, Wash., Oct. 30 – Kimball International, Inc. entered into an amended and restated credit agreement on Oct. 24, allowing for up to $75 million in borrowings, according to an 8-K filing with the Securities and Exchange Commission.

JPMorgan Chase Bank, NA is the bookrunner and lead arranger, as well as the administrative agent.

The credit agreement provides for an option to increase the amount available for borrowing to $150 million at the company's request, subject to participating banks’ consent.

There are no revolving loans outstanding under the credit agreement.

The revolving loans may consist of, at the company's election, advances in dollars or in any other currency that is agreed to by the lenders.

The proceeds are to be used for general corporate purposes, including acquisitions.

A portion of the credit facility, not to exceed $10 million of the principal amount, will be available for the issuance of letters of credit.

Interest is Libor plus 100 basis points to 175 bps based on the company's ratio of consolidated total debt to adjusted consolidated EBITDA.

A commitment fee on the unused portion of principal amount of the credit facility is payable at a rate that ranges from 15 bps to 25 bps per annum, also based on the ratio of consolidated total debt to adjusted consolidated EBITDA.

Interest is initially Libor plus 100 bps, and the commitment fee is initially 15 bps.

The company's financial covenants require, among other things, an adjusted leverage ratio of consolidated total debt minus unencumbered U.S. cash equivalents in excess of $15 million provided that the maximum subtraction will not exceed $35 million to adjusted consolidated EBITDA, determined as of the end of each of its fiscal quarters for the then most recently ended four fiscal quarters, to not be greater than 3 times.

The Jasper, Ind.-based company provides electronic manufacturing services as well as office and hospitality furniture.

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