Business Context and Reporting Period
Ramaco Resources, Inc. (NASDAQ: METC) filed a Form 8-K on March 19, 2021, reporting the entry into a material definitive agreement. The filing details a Second Amendment to the Company's Credit and Security Agreement, originally dated November 2, 2018, involving KeyBank National Association as the administrative agent.
Key Financial Metrics
This filing does not report revenue, profit, cash flow, margins, or specific debt balances. The document focuses exclusively on the terms of a credit facility amendment designed to provide financial flexibility for growth plans.
Material Changes
The primary material change is the modification of the Fixed Charge Coverage Ratio calculation within the Credit Agreement. The amendment allows for the add-back of Capital Expenditures (CapEx) not funded by indebtedness to the ratio's numerator. Specific terms include:
- Base Add-back: $8 million for each testing period ending March 31, 2021, through December 31, 2021.
- Additional Add-back: Up to $2 million per fiscal quarter for the quarters ending June 30, September 30, and December 31, 2021.
- Aggregate Cap: The additional amount is capped at $8 million in the aggregate.
- Reduction Clause: The add-back amount is reduced dollar-for-dollar by any CapEx financed by additional indebtedness.
- Deferral: Borrowers may defer the reduced amount once to a subsequent fiscal quarter, not exceeding four fiscal quarters beyond the deferral period.
Additionally, the amendment incorporates provisions regarding the replacement of interest rate benchmarks due to the expected discontinuation of the London Interbank Offered Rate (LIBOR).
Guidance, Outlook, and Risks
Management commentary indicates the amendment is intended to support the Company's previously announced growth plans. The filing does not provide specific financial guidance, updated outlook figures, or a detailed discussion of risks beyond the standard incorporation of the full amendment text by reference.
Investor Verification Checklist
- Review Exhibit 10.1 (Second Amendment to Credit and Security Agreement) for the complete legal text and definitions of capitalized terms.
- Verify the Company's current Fixed Charge Coverage Ratio to assess the immediate impact of the new add-back provisions.
- Monitor future filings for actual Capital Expenditure figures to determine if the $8 million base and $2 million quarterly add-backs are fully utilized.
- Check for subsequent announcements regarding the transition from LIBOR to alternative interest rate benchmarks.