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UBS Closes $20MM Replacement Revolver for Ruby Tuesday

May 30, 2017, 07:10 AM
Filed Under: Restaurant

Ruby Tuesday, Inc. entered into a $20.0 million 364-day senior secured revolving credit agreement with UBS AG, Stamford Branch, to replace its previously-disclosed four-year revolving credit agreement with Bank of America, N.A., as Administrative Agent; Wells Fargo, National Association; and Regions Bank, as amended, restated or otherwise modified up to and including January 31, 2017. 

Among other things, the New Credit Facility replaces the Prior Credit Facility, which was paid off in full on May 26, 2017. The New Credit Facility is extended to the company on substantially the same terms as the Prior Credit Facility. The New Credit Facility is secured substantially by mortgages over certain of the company’s real estate assets, and substantially all of the Company’s personal property, including equity interests in certain of its subsidiaries. The New Credit Facility increases the flexibility of the Debt to EBITDAR ratio compared to the Prior Credit Facility, from 4.65:1.00 to 5.00:1.00 and reduces the permitted indebtedness under its senior notes from $350.0 million to $212.5 million. Although the total commitment amount of $20.0 million under the New Credit Facility has been reduced from $30.0 million under the Prior Credit Facility, the $15.0 million sublimit for standby letters of credit remains unchanged.
Under the terms of the New Credit Facility, interest rates charged on borrowings can vary depending on the interest rate option we choose to utilize. Options for the rate are a Base Rate or LIBOR plus, in either case, an applicable margin, provided that the rate shall not be less than zero. The Base Rate is defined as the highest of the issuing bank’s prime rate, the Federal Funds rate plus 0.50%, or the Adjusted LIBO Rate (as defined in the New Credit Facility) plus 1.0%. The applicable margin for the LIBO-based option is a 4.00% and for the Base Rate option is a 3.00%. We pay commitment fees quarterly of 0.50% on the unused portion of the New Credit Facility.

The New Credit Facility is effective as of May 26, 2017. As of May 26, 2017, the Company has no amounts drawn under the revolving loan commitment under the Senior Credit Facility, and has $10.9 million drawn under standby letters of credit under the New Credit Facility.

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