Sears Holdings amended its March 14, 2018 credit agreement, with UBS, Stamford Branch serving as administrative agent and UBS Securities acting as lead arranger and bookrunner.
According to the related 8-K filing, the agreement provided for a term loan secured by Sears’ interests in certain real properties. As of June 29, 2018, the aggregate principal amount of the loan was $71.1 million.
The amendment increased the loan-to-value cap applicable to the aggregate principal amount of the secured loan, the mezzanine loan and the additional mezzanine loans that may be incurred under the credit agreement and the mezzanine loan agreement from 55% to 69%. No upfront or other fees were paid by the company in connection with the amendment.
In connection with the amendment, Sears borrowed $50 million as an additional mezzanine loan under said loan agreement.
The company also amended its second lien credit agreement with JPP serving as administrative agent and collateral administrator. The amendment provides approximately $45 million in alternative tranche line of credit loans in exchange for a like principal amount of the company’s outstanding senior secured notes due 2018, canceling said notes.
The new loans will mature on October 15, 2018, the same maturity date as the old notes. Amounts outstanding under the new loans may be prepaid at any time, subject to a make-whole prepayment premium. The loans bear interest at a rate equal to 6 5/8% per annum, the same as the old notes. Interest on the loans is payable from April 15, 2018 on the maturity date of the loans.
The loans otherwise generally have similar terms to the existing loans under the second lien credit agreement and are guaranteed by Sears Roebuck Acceptance, Kmart and other subsidiaries of Sears Holding.
