UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 6, 2009
Kennametal Inc.
(Exact Name of Registrant as Specified in Its Charter)
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| Pennsylvania
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1-5318
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25-0900168 |
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(Commission File Number)
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(IRS Employer Identification No.) |
| of Incorporation) |
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| World Headquarters
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| 1600 Technology Way
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| P.O. Box 231 |
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| Latrobe, Pennsylvania |
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15650-0231 |
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(Zip Code) |
Registrant’s telephone number, including area code: (724) 539-0231
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c)) |
TABLE OF CONTENTS
Item 1.01 Entry Into a Material Definitive Agreement.
On July 6, 2009, we entered into an amendment (the Amendment) to our existing $500 million
Second Amended and Restated Credit Agreement (the Credit Agreement) which expires on March 21,
2011. A copy of the Amendment is filed as Exhibit 10.1 to this Form 8-K and the following summary
is not a complete description of all of the provisions of the Amendment and is qualified by
reference to the Amendment.
The
Amendment changes certain operational covenants with which we must comply including our
consolidated leverage ratio. We are currently required to have a consolidated leverage ratio (as
defined in the Credit Agreement) which does not exceed 3.50 to 1.00. The Amendment permits our
consolidated leverage ratio to be up to 4.25 to 1.00 on September 30, 2009, 4.95 to 1.00 on
December 31, 2009 and 4.00 to 1.00 on March 31, 2010. Thereafter, it returns to 3.50 to 1.00. The
Amendment also changes the manner in which we compute the consolidated leverage ratio by permitting
us to exclude cash restructuring charges up to a cumulative aggregate of $134 million over the
remainder of the Credit Agreement term. Although the Amendment permits our consolidated leverage
ratio to exceed 3.50 to 1.00 at the times set forth above, it also imposes additional restrictions
if our consolidated leverage ratio exceeds that amount: (a) if the ratio exceeds 3.50 to 1.00, we
are prohibited from (i) share repurchases and securitizations, (ii) making cash acquisitions in
excess of $25 million (and after giving effect to any acquisition our pro forma consolidated
leverage ratio may not exceed levels specified in the Amendment) and (iii) entering into capital
leases in excess of $5 million; (b) if the ratio exceeds 4.00 to 1.00 at any time on or after
September 30, 2009, we are required to grant security interests in our domestic accounts
receivable, inventory and related general intangibles to secure a portion of the Credit Agreement.
The Amendment also changes our lien covenant and off-balance sheet financing covenant. Lastly, the
Amendment makes the pricing grid used to determine the applicable interest rates that we must pay
dependent solely on our debt ratings and increases our interest rates by approximately 190 basis
points as well as increasing other fees.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit 10.1
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Amendment Number 1 to the Second Amended and Restated Credit
Agreement dated as of July 6, 2009. |