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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
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Date of Report (Date of earliest event reported):
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September 30,
2022
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TIMKENSTEEL CORPORATION
(Exact name of registrant as specified in its charter)
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Ohio
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1-36313
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46-4024951
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(State or Other Jurisdiction of Incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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1835 Dueber Avenue,
SW,
Canton,
OH
44706
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(Address of Principal Executive Offices) (Zip Code)
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(330)
471-7000
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(Registrant's Telephone Number, Including Area Code)
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Not Applicable
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(Former name or former address, if changed since last
report)
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Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
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☐
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Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the
Act:
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Shares, without par value
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TMST
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New York Stock Exchange
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Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933
(§230.405 of this chapter) or Rule 12b-2 of the
Securities
Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period
for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act.
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Item 1.01
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Entry into a Material Definitive Agreement.
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On September 30, 2022, TimkenSteel Corporation (the “Company”), as
borrower, and certain domestic subsidiaries of the Company, as
subsidiary guarantors (the “Subsidiary Guarantors”), entered into a
Fourth Amended and Restated Credit Agreement (the “Amended Credit
Agreement”), with JPMorgan Chase Bank, N.A., as administrative
agent (the “Administrative Agent”), and the lenders party thereto
(collectively, the “Lenders”), which further amends and restates
the Company’s existing secured Third Amended and Restated Credit
Agreement, dated as of October 15, 2019.
The Amended Credit Agreement provides for a $400.0 million
asset-based revolving credit facility (the “Credit Facility”),
including a $15.0 million sublimit for the issuance of commercial
and standby letters of credit and a $40.0 million sublimit for
swingline loans. Pursuant to the terms of the Amended Credit
Agreement, the Company is entitled, on up to two occasions and
subject to the satisfaction of certain conditions, to request
increases in the commitments under the Amended Credit Agreement in
the aggregate principal amount of up to $100.0 million, to the
extent that existing or new lenders agree to provide such
additional commitments. In addition to and independent of any
increase described in the preceding sentence, the Company is
entitled, subject to the satisfaction of certain conditions, to
request a separate “first-in, last-out” tranche (the “Incremental
FILO Tranche”) in an aggregate principal amount of up to $30.0
million with a separate borrowing base and interest rate margins,
in each case, to be agreed upon among the Company, the
Administrative Agent and the Lenders providing the Incremental FILO
Tranche.
The availability of borrowings under the Credit Facility is subject
to a borrowing base calculation based upon a valuation of the
eligible accounts receivable, inventory and machinery and equipment
of the Company and the Subsidiary Guarantors, each multiplied by an
applicable advance rate. The availability of borrowings may be
further modified by reserves established from time to time by the
Administrative Agent in its permitted discretion.
The interest rate per annum applicable to loans under the Credit
Facility will be, at the Company’s option, equal to either (i) the
Alternate Base Rate (as defined in the Amended Credit Agreement)
plus the applicable margin or (ii) the Adjusted Term SOFR Rate (as
defined in the Amended Credit Agreement) plus the applicable
margin. The applicable margin will be determined by a pricing grid
based on the Company’s average quarterly availability. The
Alternate Base Rate is subject to a 1.00% floor, and the Adjusted
Term SOFR Rate is subject to 0.00% floor. In addition, the Company
will pay a 0.25% per annum commitment fee on the average daily
unused amount of the Credit Facility.
As of September 30, 2022, $5.4 million was outstanding under the
Credit Facility in the form of letters of credit. The Credit
Facility will be used to finance working capital, capital
expenditures, certain permitted acquisitions and other general
corporate purposes. All of the indebtedness under the Credit
Facility is guaranteed by the Company’s material domestic
subsidiaries, as well as any other domestic subsidiary that the
Company elects to make a party to the Amended Credit Agreement, and
is secured by substantially all of the personal property of the
Company and the Subsidiary Guarantors.
The Credit Facility matures on September 30, 2027. Prior to the
maturity date, amounts outstanding are required to be repaid
(without reduction of the commitments thereunder) from mandatory
prepayment events from the proceeds of certain asset sales, equity
or debt issuances or casualty events.
The Amended Credit Agreement contains certain customary covenants,
including covenants that limit the ability of the Company and its
subsidiaries to, among other things, (i) incur or suffer to exist
certain liens, (ii) make investments, (iii) incur or guaranty
additional indebtedness (iv) enter into consolidations, mergers,
acquisitions, sale-leaseback transactions and sales of assets, (v)
make distributions and other restricted payments, (vi) change the
nature of its business, (vii) engage in transactions with
affiliates and (viii) enter into restrictive agreements, including
agreements that restrict the ability to incur liens or make
distributions.
In addition, the Amended Credit Agreement requires the Company to
maintain a minimum specified fixed charge coverage ratio on a
springing basis if minimum availability requirements as specified
in the Amended Credit Agreement are not maintained.
The Amended Credit Agreement contains certain customary events of
default. If any event of default occurs and is continuing, the
Lenders would be entitled to take various actions, including the
acceleration of amounts due under the Amended Credit Agreement, and
exercise other rights and remedies.
The Lenders and the agents (and each of their respective
subsidiaries or affiliates) under the Amended Credit Agreement have
in the past provided, and may in the future provide, investment
banking, cash management, underwriting, lending, commercial
banking, trust, leasing services, foreign exchange and other
advisory services to, or engage in transactions with, the Company
and its subsidiaries or affiliates. These parties have received,
and may in the future receive, customary compensation from the
Company and its subsidiaries or affiliates, for such
services.
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Item 9.01
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Financial Statements and Exhibits.
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(d) Exhibits
The following exhibit is filed with this Current Report on Form
8-K:
10.1
Fourth Amended and Restated Credit Agreement, dated as of September
30, 2022, by and among TimkenSteel Corporation, the other loan
parties and lenders party thereto and JPMorgan Chase Bank, N.A., as
administrative agent.
104 Cover Page Interactive Data File (embedded within the Inline
XBRL document).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
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TIMKENSTEEL CORPORATION
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Date: October 5, 2022
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By:
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/s/ Kristopher R. Westbrooks
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Kristopher R. Westbrooks
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Executive Vice President and Chief Financial Officer
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