GenCorp Inc. (NYSE: GY) announced today that it executed an amendment to its $280.0 million senior credit facility. The amendment, among other things, (i) permits the Company to repurchase or refinance its outstanding convertible subordinated notes and senior subordinated notes, subject to certain conditions; (ii) permits the Company to incur additional senior unsecured or subordinated indebtedness, subject to specified limits and other conditions; (iii) provides more flexible terms surrounding the leverage ratio compliance; and (iv) permits the Company to conduct a rescission offer, using stock and/or cash up to $15.0 million, with respect to certain units issued under the GenCorp Retirement Savings Plan.
The amendment reduces the revolving credit facility capacity from $80.0 million to $65.0 million and the letter of credit subfacility capacity from $125.0 million to $100.0 million. In addition, the interest rate on LIBOR rate borrowings is LIBOR plus 325 basis points, an increase of 100 basis points, and the letter of credit subfacility commitment fee has been similarly amended.
On March 18, 2010, the Company also entered into an agreement with certain holders to repurchase $22.5 million principal amount of its 9 1/2% senior subordinated notes at 102% of par, plus accrued and unpaid interest, and $14.3 million principal amount of its 2 1/4% convertible subordinated debentures at 93% of par, plus accrued and unpaid interest. The Company anticipates that it will retire the repurchased securities. The Company repurchased the debt using a portion of the net proceeds of its 4 1/16% convertible subordinated debentures issued in December 2009.
Scott J. Seymour, GenCorp Inc. President and CEO and President, Aerojet, said, "We are pleased with the successful closing of this amendment which provides the Company with more flexibility to manage its capital structure and operations."
Forward-Looking Statements
