Unassociated Document
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):
June 1,
2010
MEASUREMENT
SPECIALTIES, INC.
(Exact
name of registrant as specified in its charter)
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New
Jersey
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1-11906
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22-2378738
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(State
or other
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(Commission
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(IRS
Employer
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jurisdiction
of
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File
Number)
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Identification
No.)
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incorporation)
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1000
Lucas Way, Hampton, VA 23666
(Address
of principal executive offices) (Zip Code)
(757)
766-1500
Registrant's
telephone number, including area code
Not
applicable
(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))
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Item
1.01 Entry into a Material Definitive Agreement.
On June 1, 2010, Measurement
Specialties, Inc. (the “Company”), entered into a new Credit Agreement (the
"Senior Secured Credit Facility") dated June 1, 2010 entered into a new Credit
Agreement (the "Senior Secured Credit Facility") dated June 1, 2010 among
JPMorgan Chase Bank, N.A., as administrative agent and collateral agent (in such
capacity, the "Senior Secured Facility Agents"), Bank of America, N.A., as
syndication agent, and certain other parties thereto (the "Credit
Agreement").
Proceeds
from the Senior Secured Credit Facility were used in part to refinance the
Company’s previous Amended and Restated Credit Agreement effective as of April
1, 2006 among the Company, General Electric Capital Corporation, as agent and a
lender, and certain other parties thereto and will provide for the working
capital needs of the Company, including to effect permitted
acquisitions.
The
Senior Secured Credit Facility consists of a $110 million revolving credit
facility (the "Revolving Credit Facility") with a $50 million accordion feature
enabling expansion of the Revolving Credit Facility to $160
million. The Senior Secured Credit Facility has a variable interest
rate based on either the London Inter-bank Offered Rate ("LIBOR") or the ABR
Rate (prime based rate) with applicable margins ranging from 2.00% to 3.25% for
LIBOR based loans or 1.00% to 2.25% for ABR Rate loans. The
applicable margins may be adjusted quarterly based on a change in the leverage
ratio of the Company. The Senior Secured Credit Facility also
includes the ability to borrow in currencies other than U.S. Dollars, such as
the Euro and Swiss Franc, up to $66 million. Commitment fees on
the unused balance of the Revolving Credit Facility range from 0.375% to 0.50%
per annum of the average amount of unused balances. The Senior
Secured Credit Facility will expire on June 1, 2014 and all balances outstanding
under the Revolving Credit Facility will be due on such date. The
Senior Secured Credit Facility includes an inter-creditor arrangement with
Prudential (as defined below) and is on a pari passu (equal force)
basis with the Prudential Shelf Facility (as defined below).
The
Senior Secured Facility includes specific financial covenants for maximum
leverage ratio and minimum fixed charge coverage ratio, as well as customary
representations, warranties, covenants and events of default for a transaction
of this type. Consolidated EBITDA for debt covenant purposes is the
Company's consolidated net income determined in accordance with GAAP minus the
sum of income tax credits, interest income, gain from extraordinary items for
such period, any aggregate net gain during such period, any aggregate net gains
arising from the disposition of capital assets, any non-cash gains, and gains
due to fluctuations in currency exchange rates, plus the sum of any
provision for income taxes, interest expense, loss from extraordinary items
(including, up to an aggregate of $10 million from export control matters), any
aggregate net loss arising from the disposition of capital assets, the amount of
non-cash charges for such period, amortized debt discount for such period,
losses due to fluctuations in currency exchange rates and the amount of any
deduction to consolidated net income as a result of any grant to any members of
the management of the Company of any equity interests. The Company's
leverage ratio consists of total debt less unrestricted cash maintained in U.S.
bank accounts which are subject to control agreements in favor of JPMorgan Chase
Bank, N.A., as Collateral Agent, to Consolidated EBITDA. Adjusted
fixed charge coverage ratio is Consolidated EBITDA less capital expenditures
divided by fixed charges. Fixed charges are the last twelve months of
scheduled principal payments, taxes paid in cash and consolidated interest
expense. All of the aforementioned financial covenants are subject to
various adjustments, which are detailed in the Credit Agreement.
On June
1, 2010, the Company entered into a Master Shelf Agreement (the "Prudential
Shelf Facility") with Prudential Investment Management, Inc. ("Prudential")
whereby Prudential agreed to purchase up to $50 million of senior secured notes
(the "Senior Secured Notes") issued by the Company. Prudential
purchased $20 million of the Senior Secured Notes on June 1, 2010, and the
remaining $30 million of the Senior Secured Notes may be purchased at the
discretion of Prudential or one or more of its affiliates upon the request of
the Company. The Senior Secured Notes purchased on June 1, 2010 have
fixed interest rate of 5.70% as to $10 million of such Senior Secured Notes and
6.15% as to $10 million of such Senior Secured Notes and are due on June 1, 2015
and 2017, respectively. The Prudential Shelf Facility includes
specific financial covenants for maximum total leverage ratio and minimum fixed
charge coverage ratio consistent with the Senior Secured Credit Facility, as
well as customary representations, warranties, covenants and events of
default. The Prudential Shelf Facility includes an inter-creditor
arrangement with the Senior Secured Facility Agents and is on a pari pasu (equal force) basis
with the Senior Secured Facility.
The
Company has provided a security interest in substantially all of the Company's
U.S. based assets as collateral for the Senior Secured Facility and the
Prudential Shelf Facility.
(d)
Exhibits.
99.1
Press release issued by Measurement Specialties, Inc., dated June 1,
2010.
99.2
Senior Secured Credit Facility Agreement by and among Measurement Specialties,
Inc. and JPMorgan Chase Bank and Bank of America dated June 1,
2010.
99.3
Master Shelf Agreement with Prudential Investment Management, Inc. dated June 1,
2010
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.
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Measurement
Specialties, Inc.
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(Registrant)
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/s/
Mark Thomson
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Mark
Thomson
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Chief
Financial Officer
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Date: June
1, 2010