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| LAWS > SEC Filings for LAWS > Form 8-K on 25-Aug-2009 | All Recent SEC Filings |
25-Aug-2009
Entry into a Material Definitive Agreement, Termination of a Material
On August 21, 2009 Lawson Products, Inc. (the "Company") and certain of its subsidiaries (together with the Company, the "Borrowers") entered into a Credit Agreement ("Credit Agreement") as borrowers with The PrivateBank and Trust Company as agent and lender. The Credit Agreement provides the Company with a total borrowing capacity of $55.0 million in the form of revolving loans and letters of credit and expires on August 21, 2012. Additionally, the Borrowers have a one-time option, subject to the agent's consent, to increase the maximum borrowing capacity by up to $20.0 million, thus making the maximum borrowing capacity $75.0 million. The Credit Agreement is secured by the each Borrower's cash, accounts receivable and inventory. Each Borrower has agreed not to place any lien on its real estate.
The interest rate is initially set at either LIBOR plus 3.0% or the prime rate through December 31, 2009. Thereafter, the interest rate will be adjusted based on the Company's debt to EBITDA ratio.
The Credit Agreement restricts the amount of annual dividends to $7.0 million. The Credit Agreement requires the Borrowers to comply with certain financial covenants, including minimum EBITDA and tangible net worth levels, and a minimum debt service coverage ratio. The Credit Agreement also contains other customary representations, warranties, covenants and events of default.
A copy of the Credit Agreement is attached to, and is incorporated by reference into, this Current Report on Form 8-K as Exhibit 10.1. The foregoing description of the Credit Agreement is qualified in its entirety by reference to the full text of the Credit Agreement.
On August 21, 2009, the Company terminated the First Amended and Restated Credit Agreement with Bank of America, N.A. dated as of November 7, 2008 and paid all outstanding loans under such credit agreement. No prepayment penalties were incurred as part of the termination.
The information set forth above in Item 1.01 of this Current Report on Form 8-K with respect to the Credit Agreement is incorporated by reference into this Item 2.03.
(d) Exhibits
10.1 Credit Agreement dated as of August 21, 2009, by and among Lawson Products, Inc. and certain of its subsidiaries and The PrivateBank And Trust Company.
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