Krispy Kreme amends facility to relax covenants, raise rates

By Jennifer Chiou

New York, April 9 - Krispy Kreme Doughnuts Inc. announced that it obtained amendments to its secured credit facility to relax financial covenants that are scheduled to become more stringent during fiscal 2009.

Interest on loans outstanding under the facilities will increase to Libor plus 550 basis points from Libor plus 350 bps, with a minimum Libor rate of 325 bps.

In addition, fees on letters of credit outstanding under the facilities will increase to 5.75% from 3.75%.

As of Feb. 3, the outstanding balance of the term loan was $76.1 million and $20.3 million of letters of credit were outstanding.

There were no amounts drawn under the revolving facility, which was reduced to $30 million from $50 million.

The company announced plans for the amendments on April 1.

Krispy Kreme is a Winston-Salem, N.C.-based branded specialty retailer of sweet treats.

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