Lumber Liquidators restates credit facility for $100 million revolver

By Marisa Wong

Madison, Wis., April 29 – Lumber Liquidators Holdings, Inc. entered into a second amended and restated credit agreement on April 24 with Bank of America, NA as administrative agent, collateral agent and lender, according to an 8-K filing with the Securities and Exchange Commission.

Under the credit agreement, Bank of America increased the maximum amount of borrowings under the revolving credit facility to $100 million from $50 million.

The borrowers also have the option to increase the revolver up to a maximum of $175 million.

The credit agreement amends and restates the company’s existing revolver dated Feb. 21, 2012.

The restated revolver matures on April 24, 2020.

The facility is subject to a borrowing base calculated based on the company’s credit card receivables and eligible inventory in the United States.

Letters of credit are subject to a $20 million sublimit, an increase from $10 million under the existing revolver.

The amended facility requires prepayment of revolving loans and cash collateralization of outstanding letters of credit if and to the extent that the aggregate outstanding amount of those loans and letters of credit exceeds the maximum amount permitted.

The amended facility generally maintains the interest rates and fees of the existing revolver. Interest is equal to Libor plus a margin ranging from 112.5 basis points to 137.5 bps, depending on average daily excess borrowing availability.

There is also a fee for each commercial letter of credit issued under the revolver at the rate that is one-half of the rate used to compute fees for standby letters of credit under the revolver. In addition, the company must pay an unused commitment fee of 0.15%.

The credit agreement contains a financial covenant to maintain a fixed-charge coverage ratio of at least 1.0 to 1.0, calculated quarterly on a trailing four quarters basis, that becomes effective only when specified availability under the revolver falls below the greater of $10 million or 10% of the maximum revolver amount.

As of April 24, a total of $20,871,000 of loans and letters of credit were outstanding under the revolver.

The hardwood flooring retailer is based in Toano, Va.

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