Glimcher gets commitments for modified and extended credit facility

By Sara Rosenberg

New York, Sept. 14 - Glimcher Realty Trust has received all necessary commitments from lenders to modify and extend its $470 million credit facility, according to a news release.

The term sheet adds an additional one-year extension option, which would take the maturity of the facility through December 2011.

Pricing on the revised deal will increase to Libor plus 400 basis points with a 1.5% Libor floor.

There are periodic reductions in commitment amounts throughout the term of the deal.

Covenants under the facility are also being revised, including reducing the minimum fixed charges to 1.35 from 1.50, with a further reduction to 1.30 if the company completes $150 million in asset sales and permanently reduces capacity under the facility to $350 million.

The maximum recourse debt limitation covenant was increased to 27.5% of the company's total asset value from 20%, assuming the property capitalization rate is increased to 8.5% from 7.5%.

And, the maximum leverage covenant was increased to 72.5% from 65%, assuming the property capitalization rate is increased to 8.5% from 7.5%, with agreed upon reductions to 70% as of March 31, 2010 and 67.5% as of March 31, 2011.

Security is a first mortgage on all current and future unencumbered assets, whereas the previous facility was unsecured.

The term sheet also requires that proceeds generated from operating cash flow or capital events be used to reduce outstanding borrowings under the facility and limits distributions on the company's common shares to the greater of $0.40 per common share annually or the minimum amount required to maintain REIT status.

KeyBanc Capital Markets and Bank of America are the lead arrangers on the deal.

The company launched the syndication process for the facility in early July.

The facility is expected to close in the fourth quarter, subject to lender due diligence, formal documentation and closing requirements.

Glimcher Realty Trust is a Columbus, Ohio-based real estate investment trust that owns, manages, acquires and develops enclosed regional and super-regional malls.

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