Lincoln Educational obtains $85 million secured revolver due 2015

By Marisa Wong

Madison, Wis., April 11 - Lincoln Educational Services Corp. entered into an $85 million secured revolving credit agreement on April 5 with a syndicate of four lenders led by Bank of America, NA as administrative agent, swingline lender and letter-of-credit issuer, according to an 8-K filed Wednesday with the Securities and Exchange Commission.

Bank of America Merrill Lynch acted as lead arranger and bookrunner.

The credit facility, which is due April 5, 2015, replaces the company's previous $115 million credit facility due Dec. 1, 2012. The prior facility was terminated on the effective date of the new facility.

Under the new agreement, the company may increase the total amount available by up to $50 million.

The facility includes a $5 million swingline sublimit and a $25 million letter-of-credit sublimit.

Interest is equal to Libor plus 125 basis points to 275 bps, depending on the company's consolidated leverage ratio.

Borrowings are secured by a first priority lien on substantially all of the company's assets, excluding real estate.

The facility may be used to finance capital expenditures and permitted acquisitions, to pay transaction expenses, for the issuance of letters of credit and for general corporate purposes.

As of April 5, letters of credit totaling $1,637,625 were outstanding under the prior facility and will be treated as letters of credit under the current facility.

The educational services provider is based in West Orange, N.J.

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