NexCen Brands has entered into a master loan agreement arranged by BTMU Capital Corporation that will support the Company's strategic goals and provide additional capital for the acquisition of intellectual property (IP) centric companies in its three operating verticals.
The master loan agreement allows for borrowings up to $150 million. As part of an initial draw under the agreement, the Company will receive a loan of $26.5 million which will leverage its acquisition of The Athlete's Foot Brands that it completed on November 7, 2006. Additional draws under the agreement are subject to ongoing closing conditions and credit approvals. Each draw under the agreement will have a five-year term and the interest rate will be based upon a leverage matrix. The Company expects its average interest rate to be approximately at LIBOR plus 225 basis points.
The Company expects that additional borrowings under the agreement will leverage recently completed acquisitions as well as future acquisitions.
Robert W. D'Loren, President and CEO of NexCen, offered: “With this loan facility, BTMU Capital Corporation is enabling our company to move quickly with flexibility in our activities.” He continued, “We have been reviewing many attractive acquisition opportunities that would fit well with our strategy. This new facility will enhance the way we operate and position us well for 2007. I am delighted to have the BTMUCC team as a significant capital provider,” Mr. D'Loren said.
Theodore J. Gaffney, Executive Vice President of BTMUCC, commented: “We are excited about our involvement with NexCen Brands and we have great confidence in Bob D'Loren and his team to deliver on their business plan.”
