Purple Innovation executed a new five-year $100 million senior secured credit facility with a group of financial institutions led by KeyBanc Capital Markets.

The new credit facility consists of a $45 million term loan and a $55 million revolving line of credit. Purple used proceeds from the term loan, which was fully drawn at closing, to retire all indebtedness related to the company’s existing credit agreement.

KeyBanc Capital Markets acted as joint lead arranger and will be the administrative agent for the financing. Funding will be provided through a syndicate of banks including Keybank, Bank of Montreal, Fifth Third Bank, Silicon Valley Bank, Truist, Wells Fargo, Raymond James and Arvest Bank.

“This new credit facility creates a capital structure that is more aligned with our strong balance sheet and planned capacity expansion in support of our continued profitable growth,” Joe Megibow, CEO of Purple Innovation, said. “With significantly reduced borrowing costs and greater flexibility and liquidity, Purple is now in an even stronger position to capitalize on the many long-term opportunities that lie ahead.”

The borrowing rates will be based on the company’s leverage ratio, as defined in the credit agreement, and can range from LIBOR plus 3% to 3.75% with a LIBOR floor of 0.5%. The initial borrowing rate is LIBOR plus 3%, which is 850 basis points lower than the company’s previous borrowing rate.