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GHM > SEC Filings for GHM > Form 8-K on 25-Mar-2014All Recent SEC Filings

Show all filings for GRAHAM CORP

Form 8-K for GRAHAM CORP


25-Mar-2014

Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation


Item 1.01. Entry into a Material Definitive Agreement.

Amendment to Bank of America Loan Agreement. On March 24, 2014, Graham Corporation (the "Company") and Bank of America, N.A. entered into Amendment No. 1 (the "Amendment") to the Loan Agreement dated as of December 3, 2010 (the "Loan Agreement"). The Amendment facilitated the Company's entry into the LOC Facility, as described below, by increasing the amount of Additional Contingent Liabilities (as defined in the Loan Agreement) that may be incurred by the Company to $6,000,000. The terms of the Loan Agreement are described in the Company's Current Report on Form 8-K dated December 3, 2010, which description is incorporated by reference herein.

The Amendment is attached to this Current Report on Form 8-K as Exhibit 99.1, and the preceding description of the Amendment is qualified in its entirety by reference to the full text of the Amendment.

Entry into Letter of Credit Facility. Also on March 24, 2014, the Company and HSBC Bank USA, National Association entered into a Continuing Letter of Credit Facility and a Letter Agreement with respect to such Continuing Letter of Credit Facility (together, the "LOC Facility"). The LOC Facility, which the Company entered into in order to support its international operations, provides the Company with a demand line of credit of up to $5,000,000 to be used for the issuance of standby letters of credit. Under the LOC Facility, the Company incurs an annual facility fee in the amount of 0.375% of the maximum amount available under the LOC Facility, as well as a letter of credit issuance fee of between 0.75% and 1.25% of the face amount of all letters of credit issued. The amount of each letter of credit issuance fee will be based on the Company's ratio of Funded Debt to EBITDA (as defined in the Letter Agreement). The LOC Facility requires that the Company maintain a Funded Debt to EBITDA ratio not greater than 3.5 to 1.0 and an Interest Coverage Ratio of not less than 4.0 to 1.0, in each case as defined in the Letter Agreement and based on a trailing 12 month period.

The Continuing Letter of Credit Facility and the Letter Agreement are attached to this Current Report on Form 8-K as Exhibits 99.2 and 99.3, respectively, and the preceding description of the LOC Facility is qualified in its entirety by reference to the full text of such agreements.



Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information disclosed in Item 1.01 of this Current Report on Form 8-K is incorporated into this Item 2.03 by reference.



Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
           Officers.


On March 20, 2014, the Compensation Committee of the Company's Board of
Directors approved a 3% increase to the base salary of each of the Company's
below listed named executive officers:

--------------------------------------------------------------------------------
                                                          Current Base            New
Named Executive Officer                                      Salary           Base Salary
James R. Lines,                                          $      350,200      $     360,706
President and Chief Executive Officer

Jeff Glajch,                                             $      247,200      $     254,616
Vice President - Finance & Administration and Chief
Financial Officer

Alan Smith,                                              $      211,150      $     217,485
Vice President of Operations

Jennifer Condame,                                        $      154,500      $     159,135
Controller and Chief Accounting Officer



Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.                                  Description

   99.1           Amendment No. 1 dated as of March 24, 2014 to the Loan Agreement
                  dated as of December 3, 2010 between Graham Corporation and Bank
                  of America, N.A.

   99.2           Continuing Letter of Credit Facility dated as of March 24, 2014
                  between Graham Corporation and HSBC Bank USA, National
                  Association.

   99.3           Letter Agreement dated as of March 24, 2014, with respect to the
                  Continuing Letter of Credit Facility dated as of March 24, 2014,
                  between Graham Corporation and HSBC Bank USA, National
                  Association.


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