Saga Communications reported that it closed on its new $120 million credit agreement with its bankers. The new facility is split half and half between a term loan and a revolver.
Saga said the transaction is with Bank of America as administrative agent, who along with JPMorgan Chase Bank, as syndication agent, served as the facility’s joint lead arrangers and joint book managers. Huntington National Bank, as documentation agent, Charter One Bank (a part of RBS Citizens) and Peoples United Bank completed the bank group providing the credit facility.
“I believe that that closing on this facility is great for our stockholders as it provides us a solid commercial banking facility upon which to build Saga’s future,” said Saga CEO Ed Christian.
The facility includes a $60 million term loan and a $60 million revolving loan. The loan facility was initially funded in the amount of $92.1 million. Saga intends to reduce the balance outstanding by $4.1 million on June 16, 2011 leaving a balance of $88 million drawn on the combined term and revolving facilities at that time.
The applicable margin for LIBOR Loans is based on a grid that ranges from LIBOR + 275 basis points to LIBOR + 150 basis points depending on the company’s leverage ratio. Upon converting to a LIBOR based loan on June 16, 2011, Saga said the initial applicable margin will be LIBOR + 250 basis points, which is a 50 basis point reduction to the rate that was being paid on the previous facility.