According to an 8K filed with the SEC, JPMorgan Chase Bank served as administrative agent for an amendment to Leggett & Platt’s existing revolving credit facility. The amendment will provide additional borrowing capacity under the financial covenant and further enhance L&P’s financial flexibility as it navigates the COVID-19 pandemic.
The financial covenant was amended from a calculation of total debt to trailing 12-months EBITDA to net debt to trailing 12-months EBITDA. The covenant requires net debt to remain below 4.75x the trailing 12-months EBITDA through March 31, 2021. The ratio will be reduced by 0.5x every quarter through December 31, 2021 until it reaches and will remain at 3.25x. In addition, there is a new requirement that the company cannot retain more than $300 million in cash without planned expenditures.
Leggett & Platt is a 137-year-old manufacturer that designs and produces bedding components, automotive seat support and lumbar systems, specialty bedding foams and private-label finished mattresses, components for home furniture and work furniture, flooring underlayment, adjustable beds, and bedding industry machinery.
