Healthways extends maturity of revolver by two years, will effectively trim facility by $55 million

By Jennifer Chiou

New York, April 5 - Healthways, Inc. announced a two-year extension of its $345 million revolving credit facility to a new maturity date of Dec. 1, 2013.

Meanwhile, the company's existing $55 million revolver under the same revolving credit and term loan agreement will mature on Dec. 1, 2011.

SunTrust Bank is the administrative agent on the loan agreement that, beginning Dec. 1, 2011, will include revolving availability of $345 million, including a swingline sub-facility that has been increased to $20 million from $10 million and a $75 million sub-facility for letters of credit, and an uncommitted incremental accordion facility amounting to $200 million.

The sub-facility includes up to $5 million for letters of credit in foreign currencies, according to an 8-K filing with the Securities and Exchange Commission.

As a result of the changes, the interest rate on the company's outstanding borrowings under the revolver will increase by about 100 basis points while the cost of undrawn commitments will increase by 12.5 bps.

The extension is effective as of March 30.

Healthways is required to repay outstanding revolving loans on the commitment termination dates: Dec. 1, 2011 and Dec. 1, 2013.

"We believe that the reduction from $400 million to $345 million in [revolver] capacity during the two-year extension will save the company on unused commitment fees, yet with only $87 million drawn as of March 31, 2010, still provide ample financial flexibility to execute the company's strategies over the term of the extension," Mary A. Chaput, chief financial officer, said in a news release.

Healthways is a Nashville-based provider of health-care support programs and services.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.