Regional Management amends multiple credit facilities, removes lender

By William Gullotti

Buffalo, N.Y., Dec. 21 – Regional Management Corp., and certain subsidiaries, engaged in multiple amendments spanning several credit facilities, according to an 8-K filing with the Securities and Exchange Commission.

The company entered into the fourth amendment to the seventh amended and restated loan and security agreement on Dec. 17, which removed Bank of America, NA as a lender and reduced the commitments under the facility to $500 million. The amended agreement provides for a borrowing base of up to 83% of eligible receivables, subject to adjustment at certain credit quality levels, as opposed to adjusting the percentage of inclusion in the borrowing base based on receivable type.

The amendment further set the applicable margin to 300 basis points by removing the 25 bps step-up based on availability percentage, lowered the Libor floor to 0.5% from 1%, set the unused line fee to 50 bps from a variable fee based on facility usage and extended the maturity of the facility to Sept. 20, 2024. Also included in the amendments were revisions to the eligibility criteria for contract receivables, increases to certain basket amounts, removal of the aggregate dollar cap on the warehouse facilities and certain other clarifying and conforming changes.

Subsidiary Regional Management Receivables II, LLC entered into the first amendment to the second amended and restated credit agreement with the parent as servicer and subsidiary as borrower.

Credit Suisse AG, New York Branch is the administration agent, structuring agent and syndication agent for the facility with Wells Fargo Bank, NA, via its corporate trust services, as account bank and backup servicer.

Subsidiary Regional Management Receivables IV, LLC entered into its first amendment under the same servicer/borrower relationship as its sister subsidiary.

Wells Fargo Bank, NA is the agent, committed lender and administrative agent.

Subsidiary Regional Management Receivables V, LLC also entered into its first amendment to the credit agreement under the same servicer/borrower relationship.

The receivables subsidiaries and corresponding amendments, each a warehouse amendment, have JPMorgan Chase Bank, NA as administrative agent. The warehouse amendments address definitional changes relating to a certain intercreditor agreement and security agreement, amend the “debt to tangible net worth” financial covenant to be no greater than 5x and remove “deferred tax assets” from the definition of “tangible net worth”.

Regional Management Corp. is a Greenville, S.C.-based diversified specialty consumer finance company providing a broad array of loan products primarily to customers with limited access to consumer credit from banks, thrifts, credit card companies and other traditional lenders.

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