Ocwen Financial Corporation, a financial services holding company, has entered into an amendment to its Senior Secured Term Loan (SSTL), which will become effective on March 28, 2016.
The key points of this amendment are:
- Permanently removes the consolidated total debt to consolidated tangible net worth ratio, corporate leverage ratio, and interest coverage ratio financial covenants.
- Maintains the loan-to-value ratio covenant at its current 40% level throughout the remaining term of the SSTL.
- Limits the repurchase of (i) the Company’s common stock or options to an amount not to exceed $20 million and (ii) the Company’s 6.625% Senior Notes due 2019 to an amount not to exceed $30 million. These limits may be refreshed if the Company makes additional voluntary prepayments under the SSTL.
- Requires the Company to make a prepayment on the SSTL in an amount equal to $6.3 million (for a total of $19.0 million) on each of May 31, 2016, July 29, 2016 and September 30, 2016.
- Provides for certain clarifications, additions, and cleanup items in the collateral value calculations.
“We appreciate the confidence our lenders have shown in us,” said Ron Faris, President and CEO of Ocwen. “This amendment provides us with additional flexibility under our financial covenants, while providing our lenders additional early principal payments on the SSTL and enhanced covenants regarding our ability to repurchase our equity and unsecured debt.”
Ocwen Financial Corporation is a financial services holding company which, through its subsidiaries, originates and services loans. We are headquartered in West Palm Beach, Florida, with offices throughout the United States and in the U.S. Virgin Islands and operations in India and the Philippines. We have been serving our customers since 1988.