Knowles enters into $400 million revolver at Libor plus 150-250 bps

By Sarah Lizee

Olympia, Wash., Sept. 8 – Knowles Corp. entered into a $400 million senior secured revolving credit facility on Friday with JPMorgan Chase Bank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

JPMorgan, BofA Securities, Inc. and Sumitomo Mitsui Banking Corp. are joint lead arrangers and joint bookrunners.

Bank of America, NA and Sumitomo are syndication agents. HSBC Bank USA, NA, KeyBank NA, PNC Bank, NA and U.S. Bank NA are documentation agents.

Borrowings may be used for working capital and other general corporate purposes, including refinancing debt under the company’s existing credit agreement.

Up to $100 million of the new revolver will be available in euro, pounds sterling and other currencies and up to $50 million will be made available in the form of letters of credit denominated in currencies approved by the administrative agent and the issuing banks as requested by the company.

Borrowings bear interest at Libor plus 150 basis points to 250 bps, based on a leverage ratio grid.

There is a commitment fee that ranged from 22.5 bps to 37.5 bps, also based on a leverage ratio grid.

There is a swingline sublimit of $20 million.

The company may request up to $200 million of incremental facilities.

The facility will mature on Jan. 2, 2024, subject to a springing maturity test date on Aug. 2, 2021 relating to the company’s 3.25% convertibles notes due Nov. 1, 2021.

The company must maintain a minimum ratio of consolidated EBITDA to consolidated interest expense of 3.25 to 1.00, a maximum ratio of consolidated total debt to consolidated EBITDA of 3.75 to 1.00 and a maximum ratio of senior secured debt to consolidated EBITDA of 3.25 to 1.00, subject to increases following certain acquisitions.

In connection with entering into the new credit agreement, on Friday the company terminated the prior $400 million revolving credit agreement, of which $100 million was outstanding. A portion of the proceeds from borrowings under the new credit agreement was used to repay in full all amounts outstanding under the prior credit agreement.

Knowles is an Itasca, Ill.-based supplier of advanced micro-acoustic, specialty components and human interface services.

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