SUMR Brands, a global leader in premium infant and juvenile products, announced that it has entered into a Third Amended and Restated Loan and Security Agreement with Bank of America, N.A. that replaces its prior $48.0 million asset-based revolving credit facility (“ABL”) with Bank of America and $17.5 million term loan with Pathlight Capital LLC.
“We’re pleased to announce that the Company has successfully concluded the refinancing of its debt, entering into a new agreement with Bank of America that establishes a solid foundation to support ongoing growth, working capital needs and also significantly reduces future interest expense,” said Stuart Noyes, Interim CEO. “Operating under this new Credit Facility is expected to lower our interest cost by approximately $2.0 million annually based on current borrowing levels.”
Mr. Noyes continued, “This year we have made great progress improving operational efficiencies throughout the organization and the Company returned to profitability. The new Credit Facility represents an important milestone for SUMR as we build on structural improvements and position the Company for growth. We will continue to strategically invest in key business drivers, such as e-commerce expansion, innovative product development, and results-based marketing, while further reducing outstanding debt. We appreciate Bank of America’s partnership and validation of the transformative measures taken by the Company this year and look forward to making continued enhancement to the business to maximize shareholder value.”
The new Credit Facility, solely with Bank of America, consists of a $40.0 million ABL, a $7.5 million term loan, and a $2.5 million FILO (first-in, last-out) loan, for aggregate availability of $50.0 million. The Credit Facility provides adequate liquidity for SUMR with significantly reduced interest rates compared to the Company’s prior financing agreements. After paying off existing debt, the Company had approximately $9 million in availability under the Credit Facility. Additional information may be found in the Company’s Form 8-K filed with the SEC.