Sears Authorized Hometown Stores, Sears Home Appliance Showrooms and Sears Outlet Stores entered into a $40 million term loan credit agreement with Gordon Brothers Finance Company as agent, lead arranger, sole bookrunner and lender.

Will Powell, president and CEO of Sears, said, “We are excited to get this term loan in place. We believe it will provide us with financial flexibility to make investments in warehouse inventory with the numerous direct purchasing relationships we have established with leading manufacturers such as Whirlpool, Samsung, GE, Husqvarna, and Stanley, Black & Decker. We expect these direct purchasing relationships, in turn, will enable us to continue to provide our customers with access to the leading brands in home appliances, lawn and garden, and tools while maintaining the outstanding customer service for which we are known in the communities we serve.”

According to a related 8-K filing, the term loan will mature either on the maturity date of February 16, 2023, as specified in the company’s amended and restated credit agreement, dated November 1, 2016, among the company, the borrowers, the lenders and Bank of America, as agent; or on an accelerated maturity date following an event of default in accordance with the term loan agreement.

The term loan agreement is secured by a second lien security interest (subordinate only to the liens securing the senior ABL facility) on substantially all the company’s assets and its subsidiaries including, without limitation, accounts receivable, inventory, general intangibles, investment property, equipment, cash, cash equivalents, deposit accounts and securities accounts, as well as other assets (other than intellectual property and fee-owned interests in real property) ancillary to any of the foregoing and all proceeds of any of the foregoing, including cash proceeds and the proceeds of applicable insurance. The term loan agreement is guaranteed by the company and each of its existing and future direct and indirect wholly owned domestic subsidiaries (other than specified immaterial subsidiaries).