Annual report pursuant to Section 13 and 15(d)

Subsequent Events

v3.21.1
Subsequent Events
12 Months Ended
Mar. 31, 2021
Subsequent Events [Abstract]  
Subsequent Events

Note 19 – Subsequent Events:

 

On June 1, 2021, the Company acquired Barber-Nichols, Inc. ("BNI"), a privately-owned designer and manufacturer of turbomachinery products for the aerospace, cryogenic, defense and energy markets, located in Arvada, Colorado.  The Company believes that this acquisition furthers its growth strategy through market and product diversification, broadens its offerings to the defense and energy markets and strengthens its presence in the defense sector.

 

Under the terms of the stock purchase agreement, the purchase price of $70,113 is comprised of 610 shares of the Company common stock, representing a value of approximately $8,963, and cash consideration of $61,150, subject to certain potential adjustments, including a customary working capital adjustment.  The stock purchase agreement also includes a contingent earn-out dependent upon certain financial measures of BNI post-acquisition, in which the sellers are eligible to receive up to $14,000 in additional cash consideration.  

 

On June 1, 2021, the Company entered into a $20,000 five-year term loan with Bank of America.  The term loan requires monthly principal payments of $167 through June 1, 2026, with the remaining principal amount due on the maturity date.  The interest rate on the term loan is the applicable Bloomberg Short-Term Bank Yield Index ("BSBY"), plus 1.50%, subject to a 0.00% floor.  In addition, on June 1, 2021, the Company entered into a revolving credit facility with Bank of America that provides a $30,000 line of credit, including letters of credit and bank guarantees, expandable at the Company’s option and the bank’s approval at any time up to $40,000.  The agreement has a five-year term.  Amounts outstanding under the facility agreement will bear interest at a rate equal to

BSBY plus 1.50%, subject to a 0.00% floor.  Outstanding letters of credit under the agreement are subject to a fee of 1.50%.  The upfront fee for both the term loan and revolving credit facility is .20% of the committed facilities and amounts available for borrowing under the revolving credit facility are subject to an unused commitment fee of .25%.  Under the term loan agreement and revolving credit facility, the Company covenants to maintain a maximum total leverage ratio, as defined in such agreements, of 3.0 to 1.0, a minimum fixed charge coverage ratio, as defined in such agreements, of 1.20 to 1.0 and minimum margined assets, as defined in such agreements, of 100% of total amounts outstanding on the revolving credit facility, including letters of credit.  

 

On June, 1, 2021, the Company entered into an agreement to amend the letter of credit facility agreement with HSBC Bank USA, N.A. and decreased the Company’s line of credit from $15,000 to $7,500.  Under the amended agreement, the Company incurs an annual facility fee $5 and outstanding letters of credit are subject to a fee of between .75% and .85%, depending on the term of the letter of credit.  Interest is payable on the principal amounts of unreimbursed letter of credit draws under the facility at a rate of 3% plus the bank’s prime rate.

In addition, on June 1, 2021, the Company entered into an employment agreement with a key employee of BNI, which is consistent with agreements with other named executive officers.