Rocky Mountain Dealerships announced it has upsized and amended its syndicated credit facility, consolidating several sub-facilities into three general lines. The amendment also re-terms the amortizing debt, reducing future scheduled debt repayments.
Canadian Imperial Bank of Commerce (CIBC) and HSBC Bank Canada acted as co-lead arrangers and joint bookrunners on the credit facility, with CIBC acting as administrative agent. The Bank of Nova Scotia, Rabobank Canadian Branch, De Lage Landen Financial Services Canada and Alberta Treasury Branches continue to participate in the syndicate, with BNS now acting as Syndication Agent and Rabobank acting as Documentation Agent.
The credit facility was upsized to $270 million and provides Rocky with a $70 million operating facility, a $125 million flooring facility, and a $75 million revolving term facility, with the availability of an additional $50 million accordion feature. Among the amendments made to the credit facility are the inclusion of an interest-only period of six months on the term debt and an extension of the amortization period of the term debt to seven years.
Commenting on the amended credit facility, David Ascott , CFO of Rocky, said, “We appreciate the continued support of our lenders and the enhancements to our credit facility. The amendments to the credit facility will allow Rocky to better manage the current economic conditions associated with the low end of the equipment demand cycle and the flexibility to de-lever our balance sheet in future periods. The extended amortization period will allow Rocky to retain approximately $4.3 million of cash generation on an annual basis, thereby providing flexibility on our FCCR covenant, while the interest-only payment period provides us with improved cash-flow for the next six months.”