Penford amends loan, changing covenants and pricing

By Sara Rosenberg

New York, Feb. 27 - Penford Corp. amended its credit facility, modifying covenants, increasing maximum pricing by 100 basis points and increasing the maximum commitment fee by 10 bps, according to a news release.

The amendment relaxed the company's funded debt ratio covenant for the last two quarters of fiscal 2009 and the first quarter of fiscal 2010.

Also, the amendment revised certain covenant calculations to reflect the financial impact of the June 2008 flood event at its Cedar Rapids Industrial Ingredients manufacturing facility.

The need for this amendment was driven in part by slower than expected insurance recoveries from the flood.

The amendment was effective as of Feb. 26.

Bank of Montreal is the administrative agent on the deal.

Penford is a Centennial, Colo.-based developer, manufacturer and marketer specialty, natural-based ingredient systems for a variety of industrial and food applications.

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