Denny’s Corporation refinanced its amended and restated $350 million revolving credit facility to a new five-year $400 million revolving credit facility.
Borrowings under the new credit facility will bear a tiered interest rate, which is based on the Company’s consolidated leverage ratio. Based on a current outstanding balance of $170 million, the interest rate is initially set at LIBOR plus 225 basis points, representing a 75 basis point reduction in the Company’s credit spread at the current consolidated leverage ratio.
Wells Fargo Securities, Truist Securities, Bank of the West, and Regions Capital Markets, a division of Regions Bank served as the Joint Lead Arrangers and Joint Bookrunners for the new credit facility with Wells Fargo Bank, serving as Administrative Agent and L/C Issuer, and Cadence Bank and Fifth Third Bank serving as Co-Documentation Agents.
With the enhanced flexibility provided by the new credit facility, the Company will relaunch its multi-year share repurchase program with approximately $248 million remaining in authorized share repurchases. Under this authorization, the Company may purchase its Common Stock from time to time in the open market or in privately negotiated transactions. The amount and timing of any repurchases will depend on a number of factors, including the price and availability of the Company’s shares, trading volumes, and general market conditions.
Robert Verostek, Executive Vice President and Chief Financial Officer, stated, “This refinancing is a testament to the dedication and hard work of our teams and the ongoing confidence the financial community has in this iconic brand. In addition to expanding our current borrowing capacity and improving our current credit spread, this new facility provides Denny’s with long-term financial flexibility to continue returning capital to our shareholders, while also enhancing our ability to make appropriate investments in the brand.”
The Company has allocated approximately $554 million to repurchase approximately 54 million shares since late 2010.