Comerica Bank Provides Credit Agreement to Universal Power
Universal Power Group (UPG) and a third-party logistics provider announced the signing of a four-year credit agreement and term loan with Comerica Bank.
The $30 million credit facility includes an accordion feature that will allow for a $10 million increase to the credit line if needed. The new credit agreement expires on Dec. 31, 2016 and replaces UPG’s current credit agreement.
The interest rate associated with the new credit agreement is based on the LIBOR plus 1.875% for the first year of the agreement. During years two through four, the rate will vary based on the ratio of UPG’s total debt to total tangible net worth, and will be set at LIBOR plus a spread of between 1.875% and 2.125%.
The company maintains a credit facility to finance short-term demands for working capital and other needs associated with its long-term growth initiatives. In conjunction with the new credit agreement, UPG has implemented a $4 million, four-year term loan which will be used to refinance existing debt under the company’s previous credit facility. The term loan is payable in equal quarterly installments of principal plus accrued interest and a balloon payment at the end of year four.
“We are pleased to begin this new relationship with Comerica Bank and are proud to be recognized by such a reputable financial institution for our solid financial performance,” stated Ian Edmonds, UPG’s president and CEO. “This new credit facility will allow us to continue to control our borrowing costs, while providing a readily available source of capital to fund our short- and long-term initiatives for future growth.”
Universal Power Group is a supplier and distributor of batteries and related accessories and services.