Sears amends term loan for additional $113 million, extends maturity

By Marisa Wong

Morgantown, W.Va., Sept. 4 – Sears Holdings Corp., through SRC O.P. LLC, SRC Facilities LLC and SRC Real Estate (TX), LLC, entered into a third amendment on Aug. 31 to its credit agreement dated March 14 with UBS AG, Stamford Branch, LLC as administrative agent and UBS Securities LLC as lead arranger and bookrunner for additional term loans, according to an 8-K filing with the Securities and Exchange Commission.

The credit agreement originally provided for term loans totaling $200 million. Immediately prior to the amendment, the amount of the loan was $30 million.

Under the amendment, the borrowers drew an additional $113 million.

The original loan was set to mature on Dec. 14. In connection with the amendment, the maturity date of the original loan was extended to Aug. 30, 2019, which is also the maturity date of the add-on term loan.

The loans will bear interest at Libor plus 650 basis points for the first four months following the effective date of the amendment, stepping up to Libor plus 750 bps for the fifth through the eighth month and Libor plus 850 bps for the ninth through the 12th month.

The company paid an upfront commitment fee of 2.75% of the principal amount of the additional term loan.

The loans are secured by the borrowers’ interests in 119 real properties. The company will use the proceeds for general corporate purposes.

Sears is a Hoffman Estates, Ill.-based retailer.

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