Volt Information Sciences (VOL) Reports Amendments to Credit Agreements
Volt Information Sciences, Inc. (NYSE: VOL) has entered into amendments to the agreements for its $150 million accounts receivable securitization program and $42 million bank credit facility.
The amendments extend the time for delivery of the Company’s audited financial statements for its fiscal year ended November 1, 2009 to the date those financial statements are filed with the Securities and Exchange Commission but no later than December 31, 2010. The Company has previously reported that it is in the process of restating its financial statements for its 2009 and 2008 fiscal years and possibly earlier periods, and that the lenders under these facilities had granted an extension to provide the required fiscal 2009 audited financial statements until May 10, 2010. No amendments were required to any of the Company’s or any subsidiary’s other credit facilities.
On May 2, 2010, the Company’s total consolidated borrowings were approximately $83 million. Under the $150 million accounts receivable securitization program, $50 million was drawn. Under the $42 million bank credit facility, $17 million of foreign currency borrowings were outstanding in addition to a $3 million of letter of credit. The Company’s consolidated cash and cash equivalents, excluding restricted cash, were more than $100 million.
In the amendment to the bank credit facility, the Company has agreed to temporarily maintain cash collateral at the administrative agent for the bank lenders equal to 105%, which is currently $21 million, of outstanding obligations until the termination of the bank credit facility and repayment by the Company of all of its obligations thereunder or, if earlier, the date the Company has delivered to the lenders all required financial statements, including its audited fiscal 2009 and 2010 consolidated financial statements, is in compliance with the bank credit facility’s financial covenants and has pledged to the bank lenders 100% of the issued and outstanding equity of Volt Funding Corp., a wholly-owned special purpose subsidiary under the securitization program. As long as the cash collateral is maintained, the Company will not be required to comply with the financial covenants contained in the bank credit facility agreement.
The securitization program does not contain financial covenants and no additional collateral is being provided thereunder.
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The amendments extend the time for delivery of the Company’s audited financial statements for its fiscal year ended November 1, 2009 to the date those financial statements are filed with the Securities and Exchange Commission but no later than December 31, 2010. The Company has previously reported that it is in the process of restating its financial statements for its 2009 and 2008 fiscal years and possibly earlier periods, and that the lenders under these facilities had granted an extension to provide the required fiscal 2009 audited financial statements until May 10, 2010. No amendments were required to any of the Company’s or any subsidiary’s other credit facilities.
On May 2, 2010, the Company’s total consolidated borrowings were approximately $83 million. Under the $150 million accounts receivable securitization program, $50 million was drawn. Under the $42 million bank credit facility, $17 million of foreign currency borrowings were outstanding in addition to a $3 million of letter of credit. The Company’s consolidated cash and cash equivalents, excluding restricted cash, were more than $100 million.
In the amendment to the bank credit facility, the Company has agreed to temporarily maintain cash collateral at the administrative agent for the bank lenders equal to 105%, which is currently $21 million, of outstanding obligations until the termination of the bank credit facility and repayment by the Company of all of its obligations thereunder or, if earlier, the date the Company has delivered to the lenders all required financial statements, including its audited fiscal 2009 and 2010 consolidated financial statements, is in compliance with the bank credit facility’s financial covenants and has pledged to the bank lenders 100% of the issued and outstanding equity of Volt Funding Corp., a wholly-owned special purpose subsidiary under the securitization program. As long as the cash collateral is maintained, the Company will not be required to comply with the financial covenants contained in the bank credit facility agreement.
The securitization program does not contain financial covenants and no additional collateral is being provided thereunder.
[SM]
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