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Item 1.01
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Entry into a Material Definitive Agreements.
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On February 19, 2021, SIFCO Industries, Inc. (the “Company”) and certain of its subsidiaries (collectively, the “borrowers”) entered into the Fifth Amendment (the “Fifth Amendment”) to the Credit Agreement (as previously amended, the “Credit Agreement”) and the First Amendment (the "First Amendment") to the Export Credit Agreement (the "Export Credit Agreement"), in each case, with JPMorgan Chase Bank, N.A., a national banking association (the “Lender”).
The Fifth Amendment amends the Credit Agreement to, among other things, extend the maturity date from August 6, 2021 to February 19, 2024 and revises the maximum borrowing amount from $30,000,000 to $28,000,000. The Fifth Amendment provides that the borrowers will not permit the fixed charge coverage ratio to be less than 1.1 to 1.0 as of the last day of any calendar month; provided that the fixed charge coverage ratio will not be tested unless (i) a default has occurred and is continuing, (ii) when the combined availability was less than or equal to the greater of (x) 10% of the lesser of the combined commitments or (y) 10% of the combined borrowing base, and (2) $2,000,000, for three or more business days in any consecutive 30 day period. Borrowings under the Credit Agreement, as amended, will bear interest at an index based on LIBOR, plus an applicable margin based on the Company's fixed charge coverage ratio, as set forth in the Fifth Amendment.
The First Amendment amends the Export Credit Agreement, pursuant to which the Lender increases its revolving commitment from $5,000,000 to $7,000,000 (which, together with the borrowing amounts under the Credit Agreement, as amended, provides for total borrowing amounts of $35,000,000). Pursuant to the terms of the amended Export Credit Agreement, the Lender will continue to lend amounts to the Company on foreign receivables that are guaranteed by the Export-Import Bank of the United States of America, and no change was made to the rate of interest such borrowings will bear.
The foregoing descriptions of the Fifth Amendment to the Credit Agreement and the First Amendment to the Export Credit Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Fifth Amendment and First Amendment, respectively, attached to this Form 8-K as Exhibit 10.1 and Exhibit 10.2, and incorporated herein by reference.