Dick's Sporting Goods enters into $500 million revolver due 2016

By Marisa Wong

Madison, Wis., Dec. 6 - Dick's Sporting Goods, Inc. and some of its subsidiaries entered into a credit agreement for a new senior secured credit facility on Dec. 5, according to an 8-K filed Tuesday with the Securities and Exchange Commission.

The facility consists of a $500 million revolving credit facility due Dec. 5, 2016, including up to $100 million in the form of letters of credit.

Besides the issuance of letters of credit, the new facility is undrawn.

According to the filing, the company may increase commitments under the revolver by up to $250 million.

The total amount of loans allowed under the new facility may not exceed a borrowing base, which is the lesser of (a) the total amount of revolver commitments minus any letter-of-credit obligations and (b) the sum of eligible credit card receivable plus eligible receivables from GSI Commerce Solutions, Inc., plus eligible inventory, minus certain availability reserves.

Interest on the revolver is equal to Libor plus 120 basis points to Libor plus 150 bps. The margin is based on average daily adjusted availability.

All outstanding borrowings under the facility are guaranteed by the company's subsidiaries and are secured by a first-priority security interest in property and assets of the company and its subsidiaries.

According to the filing, the new credit facility contains restrictive covenants and customary events of default. The new facility also requires that the company maintain a minimum adjusted availability.

Wells Fargo Capital Finance, LLC and PNC Capital Markets, LLC are the joint lead arrangers and joint bookrunners for the new credit agreement. Wells Fargo Bank, NA is the administrative agent, collateral agent, letter-of-credit issuer and swingline lender. PNC Bank, NA is the syndication agent. Bank of America, NA, JPMorgan Chase Bank, NA and U.S. Bank NA are the co-documentation agents.

Dick's is a Pittsburgh-based sporting goods retailer.

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