Gehl Co., a West Bend manufacturer of compact agricultural and construction equipment, has amended a bank credit agreement that will allow the firm to continue borrowing for 2 more years.

The agreement with U.S. bank lenders provides for a total credit commitment of $105 million and a term of 24 months. The credit line consists of an $80 million revolving line based on North American inventories and accounts receivable and a term loan of $25 million payable in quarterly installments. The credit pact replaces the company's October 2006 $125 million unsecured credit facility.

As part of the amended credit agreement, Gehl Co. has granted to its bank lenders a security interest in all of its North American assets. The amended credit agreement addresses matters that gave rise to an April 16 forbearance agreement with the lender group that rescinds and withdraws a notice of debt repayment delivered on March 31.

That agreement with lenders extended the repayment of $117 million in debt under a revolving credit agreement, which serves as the company's principal source of liquidity.

Gehl said it has significantly reduced its outstanding borrowings using operating cash flows created in part by the cost savings initiatives implemented over the past months.