Frequency Electronics secures $10M revolving credit facility from JPMorgan
What's the deal? Frequency ElectronicsDealroom has a profile for this one. Try Dealroom →, a specialist in precision timing and frequency control products, has entered into a $10M senior secured revolving credit facility with JPMorgan Chase Bank, N.A.Dealroom has a profile for this one. Try Dealroom → The three-year facility, which matures on June 12, 2029, will fund general corporate purposes and working capital.
Up to $5M of the facility is available for letters of credit. The company also has the option to increase the total facility by an additional $10M, subject to customary conditions.
Loans under the agreement bear interest at either the Prime Rate (no less than 2.50%) plus 2.50%, or the Adjusted Term SOFR Rate plus 2.50%, depending on the borrowing type. Undrawn commitments carry a 0.35% annual fee.
Why now? The facility gives Frequency Electronics flexible access to capital at a time when precision timing technology is in growing demand across defence, space, and communications sectors. A revolving credit line — rather than a fixed-term loan — suggests the company wants liquidity on hand without committing to debt it may not immediately need.
What could go wrong? The facility is fully secured. Frequency Electronics and its subsidiary FEI-ZyferDealroom has a profile for this one. Try Dealroom → have pledged substantially all of their assets, including equity in domestic subsidiaries, as collateral. That means a default could put the company's core assets at risk.
The agreement also imposes financial covenants: a total leverage ratio capped at 2.25x and a fixed charge coverage ratio of at least 1.25x, tested quarterly starting July 31, 2026. Breaching those thresholds — or tripping any of the customary default provisions — would let JPMorgan accelerate repayment.
There is also no guarantee that the optional $10M increase will materialise.
The signal: Frequency Electronics, founded in 1962 and classified as a mature-stage public company, is not a typical candidate for headline-grabbing financing — which is precisely the point. A revolving credit facility from a corporate lender like JPMorgan Chase suggests steady, bankable cash flows rather than venture-style growth ambitions, positioning the company to quietly capitalise on surging government and defence spending on precision timing infrastructure without altering its capital structure.
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