Zales amends term loan, removing consolidated EBITDA requirement

By Sara Rosenberg

New York, Sept. 27 - Zale Corp. amended its term loan with Z Investment Holdings LLC, eliminating the minimum consolidated EBITDA covenant, according to an 8-K filed with the Securities and Exchange Commission on Monday.

In addition, the amendment eliminated the PIK option under the term loan.

The amendment was completed on Sept. 24.

In consideration for the amendment, the company agreed to pay Z Investment $25 million, of which $11.25 million was used to repay term loan borrowings, $1.25 million was a prepayment premium, and $12.5 million was an amendment fee.

Furthermore, the company received a waiver on Sept. 24 under its amended and restated credit facility allowing for the amendment to the term loan and the $25 million payment.

Zales is an Irving, Texas-based specialty retailer of diamonds and other jewelry products.

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