Business Context and Reporting Period
Company: Optical Cable Corporation (OCC)
Filing Type: Form 8-K (Current Report)
Date of Report: April 30, 2020
Reporting Period: Event date of April 30, 2020
The Company, incorporated in Virginia, operates manufacturing and office facilities in Roanoke, Virginia, and near Asheville, North Carolina. This filing reports the entry into a material definitive agreement regarding its credit facilities.
Key Financial Metrics
This filing does not contain financial performance data such as revenue, profit, cash flow, or margins. The report focuses exclusively on a modification to the Company's debt structure.
- Debt Instrument: Credit Agreement dated April 26, 2016 (as amended).
- Lender: Pinnacle Bank (successor to Bank of North Carolina).
- Collateral: Land and buildings at headquarters and manufacturing facilities in Roanoke, VA, and Asheville, NC, plus personal property and assets.
- Maturity Date: The Revolving Credit Note matures on June 30, 2020.
Material Changes
On April 30, 2020, the Company entered into an Eleventh Loan Modification Agreement with Pinnacle Bank. The primary change was the removal of a specific covenant requirement previously established in the Eighth Amendment (dated January 20, 2020).
- Removed Requirement: The Company is no longer required to secure a financing commitment letter, similar equity commitment, or combination thereof to refinance the Revolving Credit Note prior to May 1, 2020.
- Unchanged Terms: All other terms of the Loan remain unaltered and in full force and effect.
Outlook, Risks, and Management Commentary
Management Commentary: The modification was executed to provide flexibility regarding the refinancing of the Revolving Credit Note maturing in June 2020 by eliminating the immediate deadline for a commitment letter.
Risks and Contingencies: The filing does not explicitly detail new risks, but the context implies ongoing liquidity management needs given the recent history of loan modifications (nine prior amendments since 2016) and the upcoming maturity of the Revolving Credit Note.
Investor Verification Checklist
- Verify the status of the Revolving Credit Note maturing on June 30, 2020, and whether refinancing has been secured since the removal of the commitment letter requirement.
- Review the full text of the Eleventh Loan Modification Agreement (Exhibit 4.1) for any covenants or conditions not summarized in the 8-K.
- Monitor subsequent filings for updates on the Company's liquidity position and ability to service debt without the previously mandated refinancing commitment.
- Confirm the current status of the Company's operations in Roanoke, VA, and Asheville, NC, as these assets serve as primary collateral.