Item 1.01 Entry Into a Material Definitive Agreement.
Beginning effective October 28, 2020, the Company and its wholly owned subsidiary TDG Operations, LLC entered into the following three credit facilities, terminating and replacing the current senior secured credit facility with Wells Fargo Capital Finance, LLC.
Effective October 28, 2020, the Company and its wholly owned subsidiary, TDG Operations, LLC, entered into that certain $10 million principal amount USDA Guaranteed term loan with AmeriState Bank as lender (the AmeriState Loan), secured by a first mortgage on the Company’s Atmore, Alabama and Roanoke, Alabama facilities. The term of the AmeriState Loan is 25 years with a straight- line amortization over the full term of the loan.
Effective October 29, 2020, the Company and its wholly owned subsidiary, TDG Operations, LLC entered into that certain $15 million principal amount USDA Guaranteed loan under the CARES Act with the Greater Nevada Credit Union as lender (the Greater Nevada Credit Union Loan), secured by a first lien on a substantial portion of the Company’s machinery and equipment and a second lien on the Company’s Atmore and Roanoke facilities. The term of the loan is 10 years, with straight line amortization over the last 7 years of the term.
Each of the AmeriState and Greater Nevada Credit Union loans bears interest at a minimum 5% rate or 4% above 5-year treasury, to be reset after 5 years at 3.5% above 5-year treasury.
Effective October 30, 2020, the Company and its wholly owned subsidiary, TDG Operations, LLC, entered into that certain $75 million Senior Secured Revolving Credit Facility with Fifth Third Bank National Association, as lender, secured by a first priority security interest on all accounts receivable and inventory, and providing for borrowing limited by certain percentages of values of the accounts receivable and inventory. The agreement is subject to customary terms and conditions and annual administrative and unused line fees with pricing varying based on excess availability, and a fixed charge coverage ratio each as defined in the agreement. The agreement matures 5 years from the date of close.
Effective October 30, 2020, the Company’s current Senior Secured Credit Facility with Wells Fargo Capital Finance, LLC was terminated in accordance with its terms and upon notice to the lender in accordance with the terms of the facility by the Company.