Pemstar amends loan to extend maturity, reduce maximum allowed borrowings, increase rates

By Sara Rosenberg

New York, Aug. 9 - Pemstar Inc. amended its credit facility, extending the maturity by three years to April 24, 2010, reducing the maximum allowed borrowings to $50 million from $90 million and increasing the interest rate by 50 basis points to Libor plus 300 bps, according to an 8-K filed with the Securities and Exchange Commission Tuesday.

Furthermore, the amendment expands certain collateral concentration to more evenly align to the company's customer mix, reduces the sublimit on borrowing available on inventories to $10 million from $20 million, increases the level of the banks' reserved collateral by $2 million to a minimum of $5 million and removes the provision that provides for the EBITDA covenants not to apply.

The amendment was completed on Aug. 5.

Wachovia Capital Finance Corp. is the lead bank on the deal.

Pemstar is a Rochester, Minn., provider of electronics manufacturing services to original equipment manufacturers.

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