EZCorp replaces credit facility with $175 million five-year revolver

By Angela McDaniels

Tacoma, Wash., May 12 - EZCorp, Inc. entered into a new $175 million senior secured revolving credit facility due May 10, 2015 on Tuesday, according to an 8-K filing with the Securities and Exchange Commission.

The interest rate is one-, two-, three-, six-, nine- or, subject to lender approval, 12-month Libor plus 200 basis points to 275 bps. The commitment fee is 37.5 bps or 50 bps, depending on leverage.

There is a $50 accordion feature, a $5 million sublimit for standby letters of credit and a $15 million sublimit for swingline loans.

Wells Fargo Securities, LLC and BBVA Compass Bank are the bookrunners and lead arrangers. Wells Fargo Bank, NA is the administrative agent, and BBVA Compass Bank is the syndication agent.

Under the revolver's covenants, the company's total leverage ratio cannot exceed 2 to 1, and its fixed-charge coverage ratio must be at least 1.25 to 1.

The new revolver replaces the company's $80 million revolver due Dec. 31, 2011 and $40 million term loan due Dec. 31, 2012. The company said there were no amounts outstanding under the previous revolver on the closing date, and the $17.5 million amount outstanding on the term loan was prepaid from cash on hand. The $5 million of outstanding letters of credit were refinanced under the new revolver, leaving $170 million available on the new revolver at closing.

The revolver will be used for working capital and other general corporate purposes, including permitted investments and acquisitions.

EZCorp operates pawn stores and short-term consumer loan stores. It is based in Austin, Texas.

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