Vishay Intertechnology, Inc. has entered into an amended and restated $640 million credit facility. The senior secured facility matures on December 10, 2020. The company’s previous credit agreement was scheduled to mature on August 8, 2018.
JPMorgan Chase Bank, N.A. acted as administrative agent. J.P. Morgan Securities LLC, Comerica Securities, Inc., Citizens Bank, N.A., and HSBC Bank USA, National Association served as joint lead arrangers and joint bookrunners. J.P. Morgan Securities LLC, Comerica Bank, Citizens Bank N.A., and HSBC Bank USA, National Association served as co-syndication agents. UniCredit Bank AG, New York Branch functioned as documentation agent.
Borrowings under the Amended and Restated Credit Facility bear interest at LIBOR plus an interest margin. The applicable interest margin is based on Vishay's leverage ratio. Based on Vishay's current leverage ratio, borrowings bear interest at LIBOR plus 1.75%. Vishay also pays a fee, also based on its leverage ratio, on undrawn amounts. The undrawn commitment fee, based on Vishay’s current leverage ratio, is 0.35% per annum. The previous credit agreement required Vishay to pay facility fees on the entire commitment amount.
The Amended and Restated Credit Facility allows an unlimited amount of defined “Restricted Payments,” which include cash dividends and share repurchases, provided the Company’s pro forma leverage ratio is less than 2.25 to 1. If the Company’s leverage ratio is greater than 2.25 to 1, the Amended and Restated Credit Facility allows such payments up to $75 million per annum (subject to a cap of $225 million for the term of the facility).
The Amended and Restated Credit Facility also removes certain restrictions related to intercompany transactions. These changes are expected to enable the Company to streamline its complex subsidiary structure and provide greater operating flexibility.
Except for the term, pricing, and certain covenants, the amended and restated credit facility is substantially similar to the previous credit agreement.