Colt Defense announced it has entered into a new senior secured term loan facility with a lender group led by Cortland Capital Market Services, as agent.

Colt said the Cortland Facility provides for a term loan of $33 million, which includes the arrangement of certain cash collateralized letters of credit in an aggregate face amount of up to $7 million, of which approximately $5 million will be used in connection with the termination of Colt’s existing revolving credit agreement.

Proceeds from the Cortland Facility will be used to repay all amounts outstanding under Colt’s existing revolving credit agreement and terminate such revolving credit agreement, for cash collateral for certain letters of credit, to pay fees incurred in connection with the consummation of the Cortland Facility and the termination of the existing revolving credit agreement, for additional liquidity and for general working capital purposes.

The Cortland Facility provides for the accrual of interest at a fixed rate of 10% per annum and matures August 15, 2018. The lenders under Colt’s existing term loan agreement dated as of November 17, 2014 have also agreed to amendments to the Term Loan Agreement necessary for Colt to enter into the Cortland Facility.

West Hartford, CT-based Colt Defense is one of the world’s oldest and most renowned designers, developers and manufacturers of firearms for military, personal defense and recreational purposes.