Stanadyne gets $25 million term loan, increases revolver by $5 million

By Angela McDaniels

Tacoma, Wash., Feb. 19 - Stanadyne Corp. entered into a $25 million second-lien term loan due June 30, 2014 on Feb. 13, according to an 8-K filing with the Securities and Exchange Commission.

The term loan bears interest at 10%. Interest is payable quarterly.

The company can issue up to an additional $15 million of incremental term loans.

Prepayment may be required upon sales of assets or a change of control.

The term loan is guaranteed by Stanadyne's immediate parent, Stanadyne Intermediate Holding Corp., and is secured by a second-lien position in some tangible and intangible assets of Stanadyne, including property, plant and equipment, fixed assets, copyrights, trademarks and patents.

Covenants include restrictions on prepayments, restrictions on dividends and limitations on sales of assets and sale and leaseback transactions.

Jefferies Finance LLC is the administrative agent.

Amendment

Also on Feb. 13, Stanadyne amended its credit facility with Wells Fargo Capital Finance, LLC as administrative agent.

The amendment increased the maximum revolver amount by $5 million, increasing the total commitment to $60.8 million.

The amendment also increased interest rates based on levels of availability. The margin over Libor is 300 basis points if the company's average excess availability is less than $8.5 million, 275 bps if it is greater than or equal to $8.5 million but less than $11 million and 250 bps if it is $11 million or more.

Some clauses within the inventory subfacility were modified to add an inventory block, and the accounts receivable subfacility was modified to increase the revolving line limit and to update the allowable customer concentration limits.

The modifications added by the amendment were also incorporated into the company's EXIM-guaranteed credit agreement.

The company, a Windsor, Conn.-manufacturer of engine components, said it has taken these actions in order to enhance its available liquidity during the production launch of new high-pressure gasoline and diesel fuel pump products.

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