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Stein Mart Increases Credit Facilites With Wells Fargo to $275MM

February 05, 2015, 07:24 AM
Filed Under: Retail

Stein Mart, Inc. announced that it has entered into a second amended and restated credit agreement  with Wells Fargo Bank that will mature in February 2020 and a master loan agreement with Wells Fargo Equipment Finance, Inc. The Credit Facilities replace the company's former $100 million senior secured revolving credit facility which was set to mature on February 28, 2017. The Credit Facilities (i) increase the revolving credit facility to $250 million, (ii) add a $25 million equipment term loan that matures 36 months following date of disbursement, (iii) provide better pricing terms, and (iv) extend the maturity date of the former revolving credit facility. Borrowings under the credit facilities will primarily be used for a special dividend, but may also be used for working capital, capital expenditures and general corporate purposes.

After payment of the dividend, the Company's debt will fluctuate between approximately $150 and $200 million in 2015 based on seasonal working capital needs. Interest expense for 2015 is estimated to be approximately $3.5 to $4.0 million based on current interest rates.

"Today's announcement of a $5.00 special dividend reflects our continued generation of strong cash flows and favorable access to the credit markets which allow us to return value to our shareholders," said Jay Stein, Chief Executive Officer. "Even after this special dividend, we will have ample capital capacity to make long-term investments in our business, such as our accelerated store expansion."

Stein Mart stores offer the fashion merchandise, service and presentation of a better department or specialty store, at prices competitive with off-price retail chains.

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