Clarus terminated its asset-backed credit facility and entered into a new $100 million cash flow credit facility, which includes an uncommitted $50 million accordion with JPMorgan Chase.
Under the terms of the new senior secured credit agreement, Clarus has access to up to a $60 million revolving credit line and a $40 million delayed draw term loan that is available until May 3, 2020, with an additional $50 million uncommitted accordion feature. The facility bears interest at an adjusted LIBOR rate plus an applicable margin ranging from 1.50% to 2.25% per annum or an alternate base rate plus an applicable margin ranging from 0.50% to 1.25% per annum, and matures on May 3, 2024.
“Over the last several quarters we have been successfully executing on our growth and profitability improvement initiatives, which have been combined with a capital allocation strategy focused on quarterly dividends, share repurchases and the opportunistic acquisition of ‘super-fan’ brands,” said Clarus CFO Aaron Kuehne. “The conversion of our credit facility to a cash flow facility provides us with increased flexibility and capacity, and will aid in maximizing our growth and capital allocation strategies. Additionally, we have a sound capital structure and a strong balance sheet in place. The conversion of our credit facility adds to that strength.”
The new facility is secured generally by substantially all assets of the loan parties, including mortgages on a post-closing basis, pledges and liens on certain subsidiary equity interests, and each loan party has guaranteed the obligations of each other loan party.
Clarus’ primary business is as a developer, manufacturer and distributor of outdoor equipment and lifestyle products focused on the climb, ski, mountain, and sport markets.
