FORM 10-K - Harman

Borrowings Under Revolving Credit Facility
On March 31, 2009, we entered into the Amended Credit Agreement, which among other things, extended
the maturity date from June 28, 2010 to December 31, 2011 and reduced the maximum amount of available
credit under the revolving credit facility from $300 million to $270 million. Interest rates for borrowings under
the Amended Credit Agreement were increased to three percent above the applicable base rate for base rate loans
and four percent over LIBOR for Eurocurrency loans. In addition, the annual facility fee rate payable under the
Amended Credit Agreement increased to one percent. The interest rate on our old revolving credit facility was
based on LIBOR plus 37 to 90 basis points, plus a commitment fee of 8 to 22.5 basis points. The interest rate
spread and commitment fee were determined based upon our interest coverage ratio and senior unsecured debt
rating. In connection with the Amended Credit Agreement, we incurred $9.7 million in fees and other expenses
which have been capitalized within other current assets and other assets in our Consolidated Balance Sheets and
which are amortized over the term of the Amended Credit Agreement as interest expense in our Consolidated
Statements of Operations.
In connection with our public offering of common stock, described in Note 11 – Shareholder’s Equity and
Share-Based Compensation in the Notes to the Consolidated Financial Statements, on June 15, 2009, we entered
into the First Amendment, as more fully described above under the caption Recent Events – Reduction in
Available Credit Under the Amended Credit Agreement.
In accordance with the Amended Credit Agreement, we are required to maintain funds on deposit in a
separate bank account in an aggregate amount equal to the outstanding letters of credit which are undrawn and
unexpired. At June 30, 2009, we had $8.0 million on deposit in a separate bank account to satisfy this
requirement.
The Amended Credit Agreement contains financial and other covenants that, among other things:
• Requires us to maintain the following levels and ratios:
• Consolidated earnings before interest, taxes, depreciation and amortization (“EBITDA”) must be
above specified amounts based on a schedule starting at $100 million for the four-quarter period
ending June 30, 2010, and increasing on a quarterly basis until reaching $250 million for the fourquarter
period ending December 31, 2011;
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