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Bank of Montreal Agents Credit Facility Amendment for Blue Bird

September 12, 2022, 07:30 AM
Filed Under: Transportation

Blue Bird Corporation, the leader in electric and low-emission school buses, entered into a fifth amendment to its credit facility, dated as of December 12, 2016.? Bank of Montreal acted as Administrative Agent and an Issuing Bank, Fifth Third Bank and Truist Bank, each an Issuing Bank according to an 8K filed wiht the SEC on September 9, 2022.

The Fifth Amendment provides covenant relief, through December 31, 2022, via a waiver of the trailing twelve-month minimum consolidated EBITDA covenant for the fiscal quarter ending October 1, 2022 and the minimum units manufactured covenant for the trailing three-month period ending October 1, 2022. Out of an abundance of caution, the Company requested such covenant relief given the supply chain disruptions that challenged the Company throughout its fiscal year.

Other terms of the amended credit facility include: a) an election to change one of the market interest rate indices that can be selected to accrue interest on outstanding borrowings from the U.S. Dollar London Interbank Offering Rate, which is being discontinued subsequent to June 30, 2023, to the Secured Overnight Financing Rate as administered by the Federal Reserve Bank of New York and b) the reporting of a monthly thirteen-week cash flow forecast during an approximate eight-month period.

"We are pleased to have the continued support of our lending partners,” said Matthew Stevenson, President and CEO of Blue Bird Corporation. “We have made substantial changes in the operations at Blue Bird and this amendment provides Blue Bird with financial flexibility while these material improvements in the business continue to take hold even during a time of supply chain volatility.”

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