Quantum Corp. announced definitive agreements with PNC Bank and TCW Direct Lending on a $170 million financing package consisting of:
- An $80 million revolving credit facility and an additional $20 million credit line available under an accordion feature, both with PNC.
- A $50 million term loan with TCW that will be drawn upon closing.
- A $20 million delayed draw term loan with TCW available through Dec. 31, 2017.
Quantum will use the proceeds of the financing to pay off the approximately $60 million drawn on its former revolving credit facility with Wells Fargo Capital Finance and to address Quantum's $70 million of convertible notes maturing in November 2017. In addition, the company will use the financing for general working capital purposes.
"We're excited about the new financing package, which achieves the key objectives we had established," said Fuad Ahmad, senior vice president and CFO of Quantum. "This package protects the interests of our current shareholders by not including an equity component and also gives us substantially more operational and financial flexibility from a capital allocation and investment standpoint."
"We've been pleased to work with PNC and TCW on this project, and the financial structure and their level of commitment further validate the long-term outlook for the company," said Jon Gacek, president and CEO of Quantum. "This includes our increasing market momentum and growth opportunities, as most recently reflected in the positive preliminary results we announced for the September quarter."
Craig-Hallum Capital Group LLC served as exclusive placement agent in connection with the transaction.
Quantum is a leading expert in scale-out storage, archive and data protection, providing solutions for capturing, sharing and preserving digital assets over the entire data lifecycle.