RealD gets $125 million facility, plans $50 million stock repurchase

By Toni Weeks

San Diego, April 20 - RealD Inc. has entered into a $125 million credit agreement on Thursday with City National Bank as administrative agent, replacing the company's existing credit agreement that was most recently amended on Dec. 6.

The facility consists of a $75 million revolving credit facility due April 17, 2015 and a $50 million delayed-draw term loan facility, according to an 8-K filing with the Securities and Exchange Commission.

The term loan matures three years after the earlier of Oct. 18, 2013 and the date that the loan has been drawn in full.

Under the credit agreement, RealD is subject to limitations on its ability to incur additional debt, make certain investments or acquisitions, enter into merger and consolidation transactions and sell assets other than in the ordinary course of business. The company must also comply with financial covenants, including a minimum fixed-charge coverage ratio and a maximum leverage ratio.

The credit agreement is guaranteed by subsidiaries ColorLink Inc. and Stereographics Corp.

The company also announced in a press release that its board of directors authorized the repurchase of up to $50 million of common stock.

"Our new $125 million credit facility, further bolstered by our expectation that RealD's business will generate strong cash flows during the current fiscal year, will allow us to capitalize on opportunities to repurchase shares," chairman and chief executive officer Michael V. Lewis said in the release.

As of April 19, RealD had roughly $30 million of cash and cash equivalents, about $100 million of unused borrowing capacity and 54.6 million shares of common stock outstanding.

RealD's common stock closed at $11.63 (NYSE: RLD) on Thursday.

Beverly Hills, Calif.-based RealD is a licensor of 3-D technologies.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.