Barrett Business Services finalized its agreement for its new credit facility with Wells Fargo, its principal bank. The principal terms of the facility are unchanged since BBSI reached an agreement in principle with Wells Fargo on December 15.

Under the terms of the agreement, the credit facility includes a $40 million term loan maturing December 31, 2016, as well as a $14 million revolving credit line, with a $5 million sublimit for unsecured standby letters of credit, maturing October 1, 2017. The term loan bears interest at LIBOR plus 4%, while the interest rate on advances under the revolving credit line is LIBOR plus 2%.

“The increased borrowing capacity speaks to the confidence our long time commercial banking partner has in our company,” said Michael Elich, president and CEO of BBSI. “This capacity addresses our short-term liquidity needs at a favorable interest rate and allows BBSI to focus on our business while supporting and growing our client base.”

The agreement also provides for an increase to a total of $114.3 million in cash-secured letters of credit to satisfy collateral requirements associated with various surety deposits for workers’ compensation purposes in the state of California. At September 30, 2014, the secured letters of credit with Wells Fargo totaled $20.9 million.