MarineMax Secures Amendment of Credit Agreement
MONDAY, 15 JUNE 2009
CLEARWATER, Fla. -- MarineMax, Inc., the nation's largest recreational boat retailer, announced that it has completed an amendment of its credit and security agreement with its seven lenders.
Michael H. McLamb, Executive Vice President, Chief Financial Officer and Secretary of MarineMax, Inc. stated, "The amendment to our credit facility is designed to provide us with additional flexibility to operate our business and navigate through these difficult economic conditions. Specifically, the amendment provides us greater flexibility under our EBITDA covenant for fiscal 2009 and fiscal 2010, compared with the Company's existing covenant, among other changes. Our significant amount of unleveraged real estate combined with the equity we have in our inventory helped to secure the amendment during this very difficult credit environment. The amendment was structured to help us achieve our objective of reducing our inventory and streamlining our cost structure, which will best position MarineMax as industry conditions improve."
The amendment modifies the amount of borrowing availability and financial covenants of the prior facility. The amended facility provides a line of credit with asset-based borrowing availability up to $300 million, stepping down to $250 million by September 30, 2009 and $175 million by September 30, 2010, with interim decreases between such dates. In order to facilitate the reduction of inventory, the amendment enables the Company to incur a cumulative EBITDA (earnings before interest, taxes, depreciation and amortization) loss of up to $40 million for fiscal 2009 plus adjustments for items such as store closing costs and losses on specific brands no longer carried by the Company. The amendment also increases the allowable EBITDA loss for the December, March and June quarters of fiscal 2010. The amendment further requires that the Company maintain a Leverage Ratio of not more than 2.75 to 1.
The amendment provides for a variable interest rate margin of LIBOR plus 490 basis points through mid November 2010 and thereafter at LIBOR plus 150 to 400 basis points, depending upon the Company's financial and operating performance. With the execution of the amendment, the Company paid a fee of $1.25 million to the lenders. The amended facility matures in May 2011, but includes two one-year renewal options, subject to lender approval.
Source: www.businesswire.com
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