lululemon enters $300 million 364-day revolving credit facility

By Marisa Wong

Los Angeles, July 1 – lululemon athletica inc. entered into a 364-day credit agreement on Monday providing for a $300 million unsecured revolver, according to an 8-K filing with the Securities and Exchange Commission.

Bank of America, NA is administrative agent and swingline lender. BofA Securities, Inc., Barclays Bank plc and HSBC Bank Canada are joint lead arrangers and joint bookrunners. Barclays Bank and HSBC Bank Canada are also syndication agents.

Borrowings bear interest at Libor plus an applicable margin based on the ratio of debt to EBITDAR ranging from 150 basis points to 225 bps. Interest is initially Libor plus 175 bps.

Additionally, a commitment fee of 25 bps to 55 bps, also based on the consolidated rent-adjusted leverage ratio, is payable on the average daily unused amounts under the credit facility. The fee is initially 35 bps.

The credit agreement requires the company to maintain a consolidated rent-adjusted leverage ratio of not greater than 3.50 to 1.00 and a ratio of consolidated EBITDAR to consolidated interest charges, plus rent, of not less than 2.00 to 1.00.

The facility is available for funding lululemon’s acquisition of Curiouser Products Inc., doing business as Mirror.

The athletic apparel manufacturer is based in Vancouver, B.C.

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