DLH, a Russell 2000 company and provider of digital transformation and cyber security, science, research and development and systems engineering and integration solutions to federal health IT and readiness agencies, made an amendment to its syndicated credit agreement. According to a related 8-K filing, First National Bank of Pennsylvania served as administrative agent, and F.N.B. Capital Markets and Manufacturers and Traders Trust Company served as joint lead arrangers._x000D_
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DLH has engaged with its lenders to negotiate an amendment to its credit agreement that modifies the financial covenants, specifically the total leverage ratio and fixed charge coverage ratio, and borrowing capacity of the company’s revolving loan. The modification of the financial covenants increases the maximum threshold on the total leverage ratio and reduces the minimum threshold on the fixed charge coverage ratio for future quarters. In addition, the amendment aligns the revolver’s borrowing capacity with operational needs by reducing the maximum from $70 million to $50 million. There were no modifications to the maturity or pricing terms of the credit facility. The joint lead arrangers led the amendment efforts along with the DLH Board of Directors and executive management._x000D_
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Management believes the amendment offers the company flexibility to navigate the anticipated transition of a portion of its business base to set-aside, small business contractors, primarily the Department of Veterans Affairs’ Consolidated Mail Outpatient Pharmacy (CMOP) program._x000D_
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“We are proud of the breadth and depth of our offerings, our expanded technology-enabled capabilities, and our highly credentialed workforce,” Zach Parker, president and CEO of DLH, said. “Because of our robust pipeline of new business opportunities, we continue to have confidence in our organic growth potential over the quarters to come. We appreciate the support our bank group has provided as we begin fiscal 2025.”
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