THE TIMKEN COMPANY Item 1.01. Entry into a Material Definitive Agreement.
On
On the same day, the Company also entered into a Second Amendment to Credit
Agreement (the "Second Amendment," together with the First Amendment, the
"Amendments"), which amends that certain Credit Agreement (the "Term Loan Credit
Agreement") with
Capitalized terms used herein, but not otherwise defined, have the meanings provided to them in the Revolving Credit Agreement, Term Loan Credit Agreement or the Amendments, as the case may be.
The Amendments, among other things, change the calculation of the Consolidated
Leverage Ratio, which is permitted to be a maximum of 3.50 to 1.00, from a
Consolidated Total Leverage Ratio (calculated as the ratio of (a) Consolidated
Funded Indebtedness as of such date to (b) Consolidated EBITDA for the period of
the four consecutive fiscal quarters ended on such date) to a Consolidated Net
Leverage Ratio (calculated as the ratio of (a) the difference of
(i) Consolidated Funded Indebtedness as of such date minus (ii) Unrestricted
Cash in excess of
• the Benchmark Replacement, Eurocurrency Rate and LIBOR Market Index Rate
under the Revolving Credit Agreement, and the Benchmark Replacement and
Eurodollar Rate under the Term Loan Credit Agreement, will each be a minimum
of 0.375% and then revert to a minimum of zero thereafter;
• the Base Rate will be a minimum of 1.375% and then revert to a minimum of
zero thereafter;
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• Priority Debt shall not exceed 10% of the total assets of the Company, and
then revert to a basket of 17% of the total assets of the Company thereafter;
and
• If any more restrictive terms are added to the Senior Notes or the Senior
Notes are secured by collateral or guaranteed by Persons that are not already
Guarantors, the Revolving Credit Agreement and Term Loan Credit Agreement
will be required to be amended in the same manner.
Copies of the Amendments are filed as Exhibits 10.1 and 10.2 hereto. The foregoing description of the Amendments does not purport to be complete, and is qualified in its entirety by reference to the full text of the Amendments, which is incorporated by reference herein.
The lenders and the agents (and each of their respective subsidiaries or affiliates) of the Amendments have in the past provided, and may in the future provide, investment banking, cash management, underwriting, lending, commercial banking, trust, leasing services, foreign exchange and other advisory services to, or engage in transactions with, the Company and its subsidiaries or affiliates. These parties have received, and may in the future receive, customary compensation from the Company and its subsidiaries or affiliates, for such services.
Item 9.01. Exhibits.
(d) Exhibits.
Exhibit
Number Description
10.1 First Amendment to Credit Agreement, dated as of May 27, 2020 ,
among The Timken Company , Bank of America, N.A . and KeyBank National
Association , as Co-Administrative Agents, KeyBank National
Association as Paying Agent, L/C Issuer and Swing Line Lender , and
the other lenders party thereto.1
10.2 Second Amendment to Credit Agreement, dated as of May 27, 2020 ,
among The Timken Company , KeyBank National Association , as
Administrative Agent, and the other lenders party thereto. 2
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
1 Portions of this exhibit have been omitted, which portions will be furnished
to the Securities and Exchange Commission upon request.
2 Portions of this exhibit have been omitted, which portions will be furnished
to the Securities and Exchange Commission upon request.
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