Big 5 Sporting Goods Corporation announced that it has entered into a new loan agreement with Bank of America, N. A.
The loan agreement has a five-year term that matures in February 2026 and provides for a secured revolving credit facility with aggregate committed availability of up to $150 million. The company may request additional increases in aggregate availability, which the lender has the option to provide, up to $200 million. Loans under the new credit facility will bear interest based on LIBO rates or a specified base rate (generally Bank of America’s prime rate), plus a margin that is determined based on the remaining availability under the credit line. The margin on LIBO rate loans ranges from 1.375 percent to 1.50 percent and the margin on base rate loans ranges from 0.375 percent to 0.50 percent, subject to interest rate floors of zero. The commitment fee assessed on the unused portion of the credit facility is 0.20 percent per annum.
Barry Emerson, the company’s chief financial officer, stated, “We are pleased to put a new credit facility in place on such favorable terms. We believe this facility underscores the strength of our financial condition, as we remain debt-free with a cash balance of $64.7 million as of the end of fiscal 2020. We appreciate the support of Bank of America, as this multi-year facility is expected to help provide the financial flexibility to support our business through the current dynamic retail environment and over the long-term.”
The Loan Agreement replaces the company’s prior financing arrangement.
Photo courtesy Big 5