| Item 1.01 | Entry into a Material Definitive Agreement |
On November 21, 2022, Chart Industries, Inc., a Delaware corporation (the “Company”), entered into an amendment (“Amendment No. 1”) to its fifth amended and restated revolving credit agreement, dated as of October 18, 2021 (the “Credit Agreement” and as amended by the Amendment No. 1, the “Amended Credit Agreement”), by and among the Company, the subsidiaries of the Company designated as borrowers from time to time thereunder, the lenders named therein, JPMorgan Chase Bank, N.A., as Administrative Agent, Bank of America, N.A., Fifth Third Bank, National Association, HSBC Bank USA, National Association, PNC Bank, National Association and Wells Fargo Bank, National Association, as Co-Syndication Agents, and BMO Harris Bank, N.A., Capital One, N.A., Citizens Bank, N.A., MUFG Union Bank, N.A. and Regions Bank, as Co-Documentation Agents.
Amendment No. 1 modifies certain provisions of the Credit Agreement to, among other things (i) permit the closing of the transaction (the “Transaction”) contemplated by the previously announced Equity Purchase Agreement (the “Purchase Agreement”) by and among the Company and Granite Holdings I B.V., a Dutch private limited liability company, Granite Holdings II B.V., a Dutch private limited liability company (“BV II”), and Granite US Holdings GP, LLC, a Delaware limited liability company, Granite US Holdings LP, a Delaware limited partnership (“Granite US”), Granite Acquisition GmbH, a German limited liability company (“Granite Germany”), Granite Canada Holdings Acquisition Corp., a corporation formed pursuant to the laws of British Columbia (“Granite Canada”), and HowMex Holdings, S. de R.L. de C.V., a Mexican limited liability company (“Granite Mexico” and, together with BV II, Granite US, Granite Germany and Granite Canada, the “Acquired Companies”), and the related financing transactions, including the incurrence of up to $3.375 billion of indebtedness under a senior bridge facility (the “Bridge Facility”); (ii) permit the incurrence of additional indebtedness to replace or refinance the Bridge Facility (either within the existing facility, or outside the facility, in each case on a pari passu, junior or unsecured basis) as well as additional incremental indebtedness or other equivalent indebtedness outside of the Bridge Facility, subject to ratio incurrence tests and a customary starter basket; (iii) adjust the financial covenants in the Credit Agreement following effectiveness of the Transactions by (A) reducing the interest coverage ratio to (x) 2.00 to 1.00 until the last day of the sixth full fiscal quarter after the closing of the Transaction, and (y) 2.50 to 1.00 thereafter; and (B) increasing the total net leverage ratio covenant to (x) 6.00 to 1.00 until the last day of the fourth full fiscal quarter ending after the closing of the Transaction, (y) 5.00 to 1.00 until the last day of the sixth full fiscal quarter ending after the closing of the Transaction and (z) 4.50 to 1.00 thereafter; and (iv) make certain other changes, including with respect to the ability to borrow in certain foreign currencies, and other modifications to the negative covenants to accommodate the business and operations of the Acquired Companies within the Amended Credit Agreement.
To the extent the Transaction does not close prior to the “Termination Date” (as defined in the Purchase Agreement), the amendments to the Credit Agreement effected by Amendment No. 1 will automatically terminate and be of no further force and effect. The foregoing description of Amendment No. 1 is qualified in its entirety by reference to the text of Amendment No. 1, a copy of which is being filed with the Securities and Exchange Commission as an exhibit to this current report on Form 8-K.
Some of the financial institutions party to Amendment No. 1 and their respective affiliates have performed, and/or may in the future perform, various commercial banking, investment banking and other financial advisory services in the ordinary course of business for the Company and its respective subsidiaries, for which they have received, and/or will receive, customary fees and commissions.
