BRIGGS & STRATTON CORPORATION (NYSE:BGG) Files An 8-K Entry into a Material Definitive Agreement

On January 29, 2020, Briggs & Stratton Corporation (the “Company”) and Briggs & Stratton AG (“B&S AG”) entered into an Amendment No. 2 to Revolving Credit Agreement (the “Amendment”) among the Company, B&S AG, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent (the “Agent”). The Amendment amends the existing Revolving Credit Agreement (as previously amended by an Amendment No. 1 thereto to change the timeline for determining whether a Restricted Payment (as such term is defined therein) is permitted and as amended by the Amendment, the “Credit Agreement”) among the Company, B&S AG, the other subsidiary borrowers from time to time party thereto, the lenders and issuing banks from time to time party thereto and the Agent.

The Amendment amends certain provisions to, among other things, (i) add a new pricing level increasing the specified margin by 25.0 basis points (a) to apply from January 29, 2020 until receipt by the Agent of the Company’s financial statements for the fiscal quarter ending on or about March 31, 2020 and (b) thereafter to apply when the Company’s Fixed Charge Coverage Ratio (as defined below) is less than or equal to 0.75 to 1.00, (ii) reduce the minimum aggregate availability required to trigger a liquidity event (as defined in the Credit Agreement) between September 27, 2019 and the end of the Company’s fiscal quarter ending on or about March 31, 2020 to the greater of (a) 7.5% of the Line Cap (as defined below) and (b) $30 million and (iii) provide for seasonal variation in calculating minimum aggregate availability required for purposes of determining the maturity date, the springing maturity date and whether certain restricted payments are permitted under the Credit Agreement.

Additionally, the Amendment amends the financial covenant to reduce the minimum aggregate availability needed to avoid triggering the requirement to comply with the Company’s consolidated fixed charge coverage ratio (as defined in the Credit Agreement) (the “Fixed Charge Coverage Ratio”) for the period from September 27, 2019 until the end of the Company’s fiscal quarter ending on or about March 31, 2020. As amended, if aggregate availability under the Credit Agreement decreases to below (i) from September 27, 2019 until the end of the Company’s fiscal quarter ending on or about March 31, 2020, the greater of (a) 7.5% of the line cap (defined as the lesser of the aggregate commitments and the aggregate borrowing base) (the “Line Cap”) and (b) $30 million and (ii) thereafter, the greater of (a) 12.5% of the Line Cap and (b) $50 million (collectively, the “FCCR Test Amount”), the Company may not permit the Fixed Charge Coverage Ratio to be less than 1.0 to 1.0 for any period of four consecutive fiscal quarters, until aggregate availability under the Credit Agreement exceeds the FCCR Test Amount for at least 30 consecutive days.

The foregoing is only a summary of the Amendment and is qualified in its entirety by reference to the Amendment, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information under Item 1.01 is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits. The exhibits listed in the Exhibit Index below are filed as part of this report.