AssetMark Financial entered into an amended and restated credit agreement with 10 banks, led by Bank of Montreal as administrative agent and sustainability coordinator. The agreement provides for a $500 million senior secured credit facility, comprised of a $375 million revolving facility and a $125 million term loan. The agreement also carries an accordion feature allowing for an additional $100 million of capacity, subject to customary terms and conditions.

The new credit facility will mature in 2027. Interest will be based on SOFR plus an applicable margin, with the applicable margin being tied to AssetMark’s total leverage ratio. At the initial funding levels, the interest rate will be adjusted term SOFR plus 1.875%. AssetMark will use the new term loan to retire $115 million outstanding under its existing revolving facility (which had a rate of LIBOR plus 2%).

“We are very excited about the opportunity to significantly increase our access to capital and reduce our ongoing borrowing costs, highlighted by margin improvement of 12.5 bps,” Gary Zyla, executive vice president and CFO of AssetMark, said. “The increase of the commitment under the credit facility and the extension of the maturity further enhances our already strong capital and liquidity position and adds to our financial flexibility. We plan to continue the strategic growth of our business both through acquisitions as well as investments in our operations to further drive organic growth.”

BMO Capital Markets, JPMorgan Chase Bank, Truist Securities, U.S. Bank and Wells Fargo Securities all acted as joint lead arrangers and joint bookrunners on the transaction.

“We are extremely grateful to our ongoing bank partners and welcome our new partners,” Zyla said. “We look forward to the opportunities ahead of us in 2022.”