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Citibank Provides $20MM Credit Facility to Wayside Technology Group

November 21, 2017, 07:09 AM
Filed Under: Technology

Wayside Technology Group,Inc., and certain of its wholly-owned subsidiaries, entered into a $20 million revolving credit facility with Citibank, N.A. to a Second Amended and Restated Revolving Credit Loan Agreement, Second Amended and Restated Revolving Credit Loan Note, Second Amended and Restated Security Agreement and Second Amended and Restated Pledge and Security Agreement.

The Credit Facility, which will be used for working capital and general corporate purposes, matures on August 31, 2020, at which time the Company must pay all outstanding principal of all outstanding loans plus all accrued and unpaid interest, and any interest, fees, costs and expenses, if any. In addition, the Company will pay regular monthly payments of all accrued and unpaid interest. The interest rate for any borrowings under the Credit Facility is subject to change from time to time based on the changes in the LIBOR Rate, as defined in the Loan Agreement (the “Index”). Interest on the unpaid principal balance of the Note will be calculated using a rate of 1.50 percentage points over the Index. If the Index becomes unavailable during the term of the Credit Facility, interest will be based upon the Prime Rate (as defined in the Loan Agreement) after notifying the Company. The Credit Facility is secured by the assets of the Company.

Among other affirmative covenants set forth in the Loan Agreement, the Company must maintain (i)a minimum Debt Service Coverage Ratio (as defined in the Loan Agreement) of not less than 2.0 to 1.0, (ii)a maximum Leverage Ratio (as defined in the Loan Agreement) of at least 2.5 to 1.0, and (iii)a minimum Collateral Coverage Ratio (as defined in the Loan Agreement) of not less than 1.5 to 1.0. Additionally, the Loan Agreement contains negative covenants prohibiting, among other things, the creation of certain liens, the alteration of the nature or character of the Company’s business, and transactions with the Company’s shareholders, directors, officers, subsidiaries and/or affiliates other than with respect to (i)the repurchase of the issued and outstanding capital stock of Wayside from the stockholders of Wayside or (ii)the declaration and payment of dividends to the stockholders of the Company.

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