Tim Hortons closes C$400 million revolver at Libor plus 87.5-170 bps

By Susanna Moon

Chicago, Oct. 9 - Tim Hortons Inc. obtained a C$400 million one-year revolving credit facility at Libor plus 87.5 basis points to 170 bps, based on the company's credit ratings.

The company entered into the agreement last Friday with RBC Capital Markets as the lead arranger and bookrunner, according to an 8-K filing with the Securities and Exchange Commission.

Royal Bank of Canada is the administrative agent; Toronto-Dominion Bank and Bank of Nova Scotia are the co-syndication agents; and Bank of Montreal is the documentation agent.

The company may upsize commitments by up to C$400 million.

The unused fee ranges from 17.5 bps to 34 bps.

Proceeds will be used for general corporate purposes.

The covenants require maintaining a leverage ratio and a minimum fixed-charge coverage ratio.

The facility includes a subsidiary guarantee structure substantially similar to that of the company's existing senior revolving credit facility dated Dec. 13, 2010 and amended on Jan. 26, 2012.

The loans may be prepaid, and commitments may be reduced in minimum amounts.

The agreement will mature on Oct. 3, 2014.

Tim Hortons is a restaurant chain based in Oakville, Ont.

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