IGT amends revolving credit facilities and term loan agreements

"The amendments provide us flexibility to navigate the near-term uncertainty caused by the COVID-19 pandemic and demonstrate the strong support we are receiving from our banking group," said Max Chiara, CFO of IGT.

2020-05-13

United States

Reading time 1:26 min

Among other topics, the amendments obligate IGT to maintain minimum liquidity of $500 million from the fiscal quarter ending June 30, 2020 through the fiscal quarter ending June 30, 2021. It also prohibits dividends and share repurchases through June 30, 2021. Until August 31, 2020, the maximum annual permitted acquisition amount is decreased to $100 million.

International Game Technology (IGT) on Wednesday announced amendments to its Revolving Credit Facilities Agreement and Term Loan Facility Agreement.

"We are pleased to announce the amendments to our revolving credit facilities agreement and term loan facility agreement," said Max Chiara, CFO of IGT. "The amendments provide us flexibility to navigate the near-term uncertainty caused by the COVID-19 pandemic and demonstrate the strong support we are receiving from our banking group."

Among other things, the amendments include four key actions:

waiving the covenants requiring IGT to maintain a maximum ratio of total net debt to EBITDA and a minimum ratio of EBITDA to net interest costs from the fiscal quarter ending June 30, 2020 through the fiscal quarter ending June 30, 2021;
obligating IGT to maintain minimum liquidity of $500 million during such fiscal quarters;
increasing the maximum ratio of total net debt to EBITDA that IGT is required to maintain for the fiscal quarters thereafter;
prohibiting dividends and share repurchases through June 30, 2021 and permitting dividends and share repurchases thereafter if the ratio of total net debt to EBITDA is below specified thresholds.

The amendments provide that from January 20, 2020 through August 31, 2021, material adverse effects arising from the COVID-19 pandemic are excluded from the definition of "material adverse effect"; cessations and suspensions of business arising from the COVID-19 pandemic will not constitute an event of default; and IGT's obligation to grant security over additional collateral is waived unless its public debt ratings are lower than BB- or Ba3. The amendments all provide that until August 31, 2020, the maximum annual permitted acquisition amount is decreased to $100 million.

The amendments are each filed as exhibits to IGT's Report on Form 6-K dated May 13, 2020. BofA Securities and Mediobanca - Banca di Credito Finanziario S.p.A. acted as IGT's Global Coordinators with respect to the amendments.