STG gets one-month loan forbearance for non-compliance with covenants

By Susanna Moon

Chicago, March 3 – STG Group, Inc. secured a limited forbearance on Feb. 24 to its credit agreement with MC Admin Co LLC as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The forbearance is for STG’s failure to comply with covenants related to the fixed-charge coverage ratio, consolidated EBITDA and the senior secured leverage ratio for the fiscal quarter ended Dec. 31.

The forbearance period will end on the earliest of March 31 and the date on which any event of default occurs other than those specified above.

STG has agreed to pay 200 basis points of additional interest on the loans under the credit agreement from Jan. 1 until the earlier of the loan repayment date and the non-compliance waiver date.

In connection with the forbearance, the company has agreed to a fee of up to $750,000, to be paid pro rata among the lenders.

Reston, Va.-based STG Group is a provider of cyber, software and intelligence solutions to the U.S. government.

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