LSB Industries enters $75 million five-year revolving facility

By Wendy Van Sickle

Columbus, Ohio, Dec. 28 – LSB Industries, Inc. entered into a credit agreement on Dec. 21 with JPMorgan Chase Bank, NA as administrative agent providing for a secured revolving credit facility of up to $75 million, according to an 8-K filing with the Securities and Exchange Commission.

An uncommitted accordion gives the company an option to increase the maximum principal amount by up to $25 million.

There is a $10 million subfacility for letters of credit.

Availability is subject to a borrowing base and an availability block of $7.5 million.

The revolver matures on Dec. 21, 2028, subject to a springing maturity to the date that its 90 days prior to the stated maturity date of the company’s existing 6¼% senior secured notes, which is Oct. 15, 2028, unless the notes have been repaid or redeemed in full prior to then.

Borrowings will bear interest at SOFR+10 basis points CSA plus 162.5 bps.

LSB and all of its subsidiaries are co-borrowers. The obligations of the borrowers are secured by a first-priority security interest in substantially all of the borrowers’ current assets, including accounts receivable and inventory

A financial covenant requires that, if LSB elects to remove the availability block, the borrowers must maintain a minimum fixed charge coverage ratio of not less than 1.00:1.00.

In connection with closing the new revolver, the company terminated is existing $65 million revolver dated Jan. 17, 2017.

LSB is a manufacturing, marketing and engineering company based in Oklahoma City.

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