Jack in the Box plans $275 million term facility via Wachovia

New York, Dec. 12 - Jack in the Box Inc. said it has started efforts to arrange a new $275 million senior secured term credit facility and to amend its existing $200 million revolving credit facility.

Wachovia Securities is the lead arranger of the new loan. Morgan Stanley is the company's financial adviser.

Proceeds will be used to refinance the company's existing $150 million term credit facility and redeem its $125 million of 8 3/8% senior subordinated notes due April 15, 2008.

The revolver will continue to be used for general corporate purposes.

The San Diego restaurant operator and franchisor said it expects the new credit facility will give it a more flexible capital structure to help it execute its previously announced strategic plan.

Jack in the Box aims to extend maturities and decrease borrowing costs with the refinancing.

The redemption of the notes and the write off of deferred financing fees will result in a pre-tax charge to earnings in the first fiscal quarter of $9 million to $10 million, but borrowing costs will fall by $3 million per year.

Standard & Poor's assigned a BB rating to the facility.

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