Astronics Corp. Enters and Terminates Agreements, Creates Financial Obligation

TL;DR

Astronics just signed and broke some deals, and now owes money. Big moves happening.

AI Summary

On July 11, 2024, Astronics Corporation entered into a Material Definitive Agreement and also terminated a Material Definitive Agreement. The company also created a direct financial obligation or an obligation under an off-balance sheet arrangement. These events are being disclosed under Regulation FD.

Why It Matters

This filing indicates significant changes in Astronics Corporation's contractual and financial commitments, which could impact its future operations and financial health.

Risk Assessment

Risk Level: medium — The simultaneous entry into and termination of material agreements, along with the creation of new financial obligations, suggests potential volatility and strategic shifts for the company.

Key Players & Entities

• Astronics Corporation (company) — Registrant
• July 11, 2024 (date) — Date of earliest event reported

FAQ

Key Financial Figures

• $200 million — the revolving credit line thereunder to $200 million from $115 million, with borrowings subj
• $115 m — it line thereunder to $200 million from $115 million, with borrowings subject to a bor
• $55 million — lity. The Company also entered into a $55 million term loan Credit Agreement (the "Term L
• $137,500 — ch fiscal quarter in an amount equal to $137,500. The principal amount of the Term Loa
• $500,000 — ze at a rate of 1.00% (or approximately $500,000) per year. Certain of the Company's s
• $15.0 million — se under the Restated Agreement, or (y) $15.0 million. The above description does not purpo
• $84.5 million — greement payoff amount of approximately $84.5 million consisted of a repayment of a term loan
• $80.3 m — n the principal amount of approximately $80.3 million, plus accrued but unpaid interest
• $3.2 million — call premium of 4.00% (or approximately $3.2 million) which satisfied all of the Company's i

Filing Documents

• atro-20240711.htm (8-K) — 32KB
• a071124exhibit101.htm (EX-10.1) — 1400KB
• a071124exhibit102.htm (EX-10.2) — 1196KB
• a071124exhibit991.htm (EX-99.1) — 16KB
• image_0a.jpg (GRAPHIC) — 35KB
• 0000008063-24-000040.txt ( ) — 3299KB
• atro-20240711.xsd (EX-101.SCH) — 2KB
• atro-20240711_lab.xml (EX-101.LAB) — 21KB
• atro-20240711_pre.xml (EX-101.PRE) — 12KB
• atro-20240711_htm.xml (XML) — 3KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. Astronics Corporation (the "Company") amended its existing credit facility on July 11, 2024 by entering into the Seventh Amended and Restated Credit Agreement (the "Restated Agreement"), with HSBC Bank USA, National Association, as agent for the lenders, and the lenders signatory thereto. The Restated Agreement increased the maximum aggregate amount that the Company can borrow pursuant to the revolving credit line thereunder to $200 million from $115 million, with borrowings subject to a borrowing base determined primarily by inventory, accounts receivable, fixed assets and real estate. The Restated Agreement extended the scheduled maturity date for the credit facility from January 19, 2026 to July 11, 2027. Under the terms of the Restated Agreement, the Company will now pay interest on the unpaid principal amount of the credit facility at a rate equal to SOFR plus a term SOFR adjustment in the amount of 0.10% per annum (which collectively shall be at least 1.00%) plus an applicable margin ranging from 2.50% to 3.00% determined based upon the Company's excess availability (as defined in the Restated Agreement). The Company will pay a quarterly commitment fee under the Restated Agreement on undrawn revolving credit commitments in an amount equal to 0.25% or 0.375% based on the Company's average excess availability under the credit facility. The Company also entered into a $55 million term loan Credit Agreement (the "Term Loan Agreement") on July 11, 2024, with HSBC Bank USA, N.A., as agent for the lenders, and the lenders signatory thereto, including certain funds managed by Redwood Capital Management, LLC. The Term Loan Agreement is secured primarily by the Company's intellectual property and equity interests of the Company's subsidiaries. The maturity date of the Term Loan Agreement is July 11, 2027. The Company will pay interest under the Term Loan Agreement at a rate equal to SOFR plus a term SOFR adjustme

02 Termination of a Material Definitive Agreement

Item 1.02 Termination of a Material Definitive Agreement. On July 11, 2024, the Company repaid in full all outstanding indebtedness under the Credit Agreement dated as of January 19, 2023 by and among the Company, the other borrowers and guarantors signatory thereto, Great Rock Capital Partners Management, LLC, as Agent and the lenders signatory thereto (as amended, the "Great Rock Agreement"). The Great Rock Agreement payoff amount of approximately $84.5 million consisted of a repayment of a term loan in the principal amount of approximately $80.3 million, plus accrued but unpaid interest, fees and expenses, including a call premium of 4.00% (or approximately $3.2 million) which satisfied all of the Company's indebtedness obligations thereunder. In connection with the repayment of such outstanding indebtedness obligations by the Company, all security interests, mortgages, liens and encumbrances securing the obligations under the Great Rock Agreement, and the Great Rock Agreement, related loan documents, and all guarantees of such indebtedness obligations were terminated in full. The Company funded the repayment of its obligations under the Great Rock Agreement with borrowings under the Restated Agreement and the Term Loan Agreement. Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. The disclosure set forth in Item 1.01 above is incorporated in this Item 2.03 by reference.

01 Regulation FD Disclosure

Item 7.01 Regulation FD Disclosure. On July 11, 2024, the Company issued a news release announcing the refinancing under the Restated Agreement and the Term Loan Agreement. A copy of the press release is attached as Exhibit 99.1. The information contained herein and in the accompanying exhibit shall not be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing. The information in this report including the exhibit hereto, shall not be deemed to be "filed" for purpose of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits. Exhibit Description 10.1 Seventh Amended and Restated Credit Agreement dated as of July 11, 2024 by and among Astronics Corporation, the other borrowers and guarantors signatory thereto, HSBC Bank USA, National Association, as Agent, and the lenders signatory thereto 10.2 Credit Agreement dated as of July 11, 2024 by and among Astronics Corporation, the other borrowers and guarantors signatory thereto, HSBC Bank USA, N.A., as Agent, and the lenders signatory thereto 99.1 Press Release of Astronics Corporation dated July 11, 2024 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Astronics Corporation Dated: July 11, 2024 By: /s/ David C. Burney Name: David C. Burney Executive Vice President and Chief Financial Officer

View Full Filing

View this 8-K filing on SEC EDGAR