Item 1.01. ... Entry into a Material Definitive Agreement.
On January 28, 2021 (the "Effective Date"), Hexcel Corporation (the "Hexcel")
entered into the Second Amendment (the "Amendment") to the Credit Agreement,
dated as of June 20, 2019, by and among the Hexcel, as borrower, the lenders
party thereto and Citizens Bank, N.A., as administrative agent, as amended by
the First Amendment dated September 28, 2020 (the "Credit Agreement" and as
amended by the Amendment the "Amended Credit Agreement").
Pursuant to the Amendment, certain terms of the Credit Agreement were modified
for a period beginning on the Effective Date to and including March 31, 2022
(unless earlier terminated by Hexcel in accordance with the Amended Credit
Agreement, the "Liquidity Covenant Period"). During the Liquidity Covenant
Period, Hexcel will not be subject to a maximum leverage ratio covenant, but
will instead be required to maintain Liquidity (as defined in the Amended Credit
Agreement) of at least $250,000,000. Additionally, during such period, Hexcel
will be subject to limitations on share repurchases, cash dividends, and its
ability to incur secured debt, in each case subject to certain exceptions; the
applicable margin and commitment fees are increased; the incremental facility
will not be available; and if Hexcel's public debt rating is downgraded to (i)
BB or lower by Standard & Poor's and (ii) Ba2 or lower by Moody's, Hexcel will
be required to grant liens on certain of its assets, which liens will be
released upon Hexcel's public debt rating being upgraded to BB+ or higher by
Standard & Poor's or Ba1 or higher by Moody's. Hexcel's current public debt
rating is BBB-/Baa3.
Additionally, the Amendment provides that Hexcel will not be subject to an
interest coverage ratio covenant until the test period ending December 31, 2021.
Finally, in connection with the Amendment, revolving commitments under the
Amended Credit Agreement were reduced to $750,000,000.
The foregoing description does not constitute a complete summary of the
Amendment or the Amended Credit Agreement and is qualified in its entirety by
reference to the full text of the Amendment and Amended Credit Agreement, which
are attached hereto as Exhibit 10.1 and incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
Number Exhibit Description
10.1 Second Amendment to Credit Agreement, dated as of January 28, 2021, by
and among Hexcel Corporation, the lenders party thereto, and Citizens
Bank, N.A., as administrative agent.
Cover Page Interactive Data File (embedded within the Inline XBRL
104 document).
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