Digi International Inc. Amends $350M Revolving Credit Facility

What Happened
Digi International Inc. announced on August 27, 2026 that it entered into an amended and restated Credit Agreement providing a $350 million senior secured revolving credit facility. The agreement names BMO Bank N.A. as administrative and collateral agent and lists BMO Capital Markets, Bank of America, N.A., and MUFG Bank, Ltd. among the lead arrangers/bookrunners. The Credit Agreement replaces Digi’s prior revolving facility dated December 7, 2023 and is described in the company’s Form 8‑K filed August 31, 2026.

Key Details

• Facility size and maturity: $350 million revolving credit facility; maturity date August 27, 2031 (5 years).
• Accordion and sublimits: uncommitted accordion up to the greater of $130M or 100% of trailing four-quarter consolidated EBITDA (or unlimited subject to pro forma net leverage ≤2.50:1); $10M letter-of-credit sublimit; $10M swingline; $75M foreign currency sublimit.
• Pricing and fees: U.S. dollar borrowings priced at Term SOFR (floor 0.00%) plus a margin (Term SOFR margin range 1.25%–2.625%; base rate margin range 0.25%–1.625%); commitment fee on unused commitments 0.15%–0.275%.
• Covenants and security: secured by substantially all assets of Digi and its domestic subsidiaries; financial covenants include minimum interest coverage ratio of 3.00x and total net leverage ratio ≤3.50x (with a possible covenant holiday to 4.00x after certain acquisitions); contains customary events of default.
• Use of proceeds: for permitted acquisitions, related fees/expenses, and general corporate purposes. Press release about the agreement was filed as Exhibit 99.1.

Why It Matters
This amendment provides Digi with multi-year liquidity and flexibility for growth or acquisitions by maintaining a $350M revolver and potential incremental capacity tied to EBITDA. Investors should note the facility is secured and includes financial covenants and default provisions that could limit certain actions (like additional indebtedness, asset sales, or restricted payments) if covenant tests are not met. Interest costs will vary with Term SOFR plus a leverage‑based margin, so borrowing costs will depend on market rates and Digi’s leverage profile.