WOONSOCKET - Juvenile health, safety and wellness product maker Summer Infant Inc. has secured an $80 million asset-based revolving credit facility with Bank of America Corp.
The loan and security agreement expires in 2018 and provides Summer Infant with interest at an unspecified base rate plus 0.25 to 0.75 percent or at Libor plus 1.75 to 2.25 percent.
According to a company release, the agreement includes covenants related to minimum consolidated Ebitda and fixed charge ratio, as well as customary affirmative and negative covenants.
In the same release, Summer Infant announced that it also entered into a new $15 million term loan agreement with Salus Capital Parters LLC. The principal of the loan will be repaid on a quarterly basis with installments of $375,000, starting with the quarter ending Sept. 30.
The loan with Salus Capital Partners matures in 2018 and bears interest at an annual rate of Libor plus 10 percent with a Libor floor of 1.25 percent. The term loan contains the same customary affirmative and negative covenants as the Bank of America agreement.
“The refinancing of our credit facility is a major milestone for Summer Infant,” Jason Macari, CEO, said in a statement. “We were encouraged by the level of lender interest and support as we considered several refinancing options, and selected Bank of America and Salus Capital as the best long-term solutions,” he added.
“These two agreements significantly lower our borrowing costs and provide financial flexibility as we execute on our long-term growth strategy. We are focused on advancing the key strategic drivers of our business, including innovation, global expansion, brand building and operational excellence,” said Macari.
Summer Infant is scheduled to release its fourth quarter and year-end 2012 financial results after the market closes on Tuesday, March 12.
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