On Deck Capital subsidiary gets $200 million ABL revolver due 2018

By Tali Rackner

Norfolk, Va., Dec. 9 – On Deck Capital, Inc. wholly owned subsidiary Prime OnDeck Receivable Trust II, LLC entered into a $200 million asset-backed revolving debt facility on Thursday with Credit Suisse AG, New York Branch as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The facility consists of $125 million of committed capacity and an additional $75 million of capacity available at the discretion of the lenders.

The commitment termination date is Dec. 8, 2018.

The interest rate is Libor plus 225 basis points, and the borrowing base advance rate is 83%.

Under the facility, the lenders commit to make loans to Prime OnDeck Receivable Trust, the proceeds of which are used to finance the trust’s purchase of small business loans from On Deck Capital in a transaction structured to be bankruptcy remote. The revolving pool of small business loans serves as collateral for the loans made to the trust under the facility. The trust is required to repay the borrowings from collections received on the loans.

OnDeck intends to initially use a portion of this facility, together with other available funds, to optionally prepay in full without penalty or premium, the existing $100 million Prime OnDeck Receivable Trust facility that was scheduled to expire in June 2017, according to a press release. As a result, OnDeck will benefit from obtaining additional funding capacity through December 2018.

The facility’s financial covenants include, among others, requirements with respect to minimum tangible net worth, maximum leverage ratio, minimum consolidated liquidity and minimum unrestricted cash.

Wells Fargo Bank, NA is the paying agent and collateral agent.

New York-based On Deck Capital is an online platform for small business lending.

© 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.