WCC

WESCO International Inc. - Form 8-K Summary

Business Context and Reporting Period

Company: WESCO International, Inc.
Filing Date: November 1, 2006 (Report Date: November 7, 2006)
Reporting Period: Current Report for events occurring on November 1, 2006.
Context: The filing announces the entry into a material definitive agreement to amend and restate the company's revolving credit facility to facilitate a previously announced acquisition.

Key Financial Metrics and Debt Structure

This filing focuses on debt restructuring rather than operational financial performance. The filing text does not provide revenue, profit, cash flow, or margin data.

• New Facility Size: $440 million revolving credit facility.
• Letter of Credit Subfacility: Up to $50 million.
• Sub-facilities:
  • U.S. sub-facility: Up to $375 million.
  • Canadian sub-facility: Up to $65 million.
• Maturity Date: November 2012.
• Interest Rate: LIBOR plus a margin ranging from 1.00% to 1.75% (based on excess availability).
• Collateral: Substantially all assets of WESCO Distribution and domestic subsidiaries (excluding real property and accounts receivable) and substantially all assets of WESCO Distribution Canada, Inc.
• Guarantors: WESCO International, Inc. and certain subsidiaries.

Material Changes Versus Prior Period

The company replaced its existing credit facility with a significantly larger one to support growth.

• Previous Facility: $275 million revolving credit facility entered into on September 28, 2005, maturing in June 2010.
• New Facility: Increased capacity to $440 million with a maturity extended to November 2012.
• Purpose of Change: To permit the acquisition of Communications Supply Holdings, Inc. ("Communications Supply").
• Compliance: The company was in compliance with all financial covenants under the old facility as of the date of the new agreement.

Outlook, Risks, and Covenants

Management Commentary: The new facility is designed to support the acquisition of Communications Supply. The agreement includes customary affirmative and negative covenants.

Covenants and Restrictions: Limitations apply to indebtedness, liens, investments, mergers and acquisitions, asset dispositions, and transactions with affiliates.

Risks and Events of Default:

• Failure to pay principal, interest, or fees.
• Failure to comply with covenants.
• Materially untrue representations or warranties.
• Insolvency or receivership events.
• Change in control of the loan parties.

Upon an event of default, lender commitments may be terminated, and all outstanding obligations may be declared immediately due and payable.

Key Facts for Investor Verification

• Verify the closing status and financial impact of the acquisition of Communications Supply Holdings, Inc.
• Monitor the company's leverage ratios to ensure compliance with the new covenants limiting indebtedness and liens.
• Track the utilization of the $440 million facility versus the previous $275 million limit to assess liquidity needs.
• Review the full text of the Amended and Restated Credit Agreement (Exhibit 10.1) for specific definitions of "eligible inventory" and "eligible accounts receivable" which limit borrowing availability.