Cybex has received a commitment from GMAC Commercial Finance to provide a term facility of up to $13,000,000, the proceeds of which will be used to repay higher cost real estate and term loans. Closing of this financing is subject to customary conditions, including the completion of appraisals and other reviews and finalization of legal documentation. Accordingly, while closing of the financing is expected to occur during July 2004, there can be no assurance that the closing will occur during this time period or at all. The Company also announced that CIT Group/Business Credit, Inc. has agreed to extend its credit facility one year from July 16, 2006 to July 16, 2007.
If and when completed, the GMAC commitment to finance is expected to result in annualized interest savings of approximately $1,000,000 per year, although third quarter 2004 savings will be offset by the immediate expensing of the balance of financing costs of approximately $340,000 associated with the real estate loan to be retired with the proceeds of the financing.
Art Hicks, CFO, stated “The GMAC commitment to finance is evidence of the continuing improvement in Cybex's operating performance. We are pleased to have earned the support of two well-regarded lenders as GMAC Commercial Finance and CIT. The resultant debt structure will aid Cybex in meeting its expansion goals.” Dan Kramer, Senior Vice President of GMAC Commercial Finance, stated “We are excited about the proposed relationship with Cybex and look forward to its consummation.”
