Town Sports International Holdings Inc (CLUB) announced that it has successfully completed a repricing of its currently outstanding $270.7 million senior secured term loan, reducing current interest rates on the term loan by a total of 125 basis points.
The repricing was effected through an amendment to the Company's existing credit agreement. The amendment reduced the applicable margin on the initial term loans from 4.50% to 3.50% for Base Rate Loans and from 5.50% to 4.50% for Eurodollar Loans and reduced the interest rate floor on the initial term loans from 2.50% to 2.25% for Base Rate Loans and from 1.50% to 1.25% for Eurodollar Loans.
The credit agreement was also amended to convert the existing voluntary prepayment penalty from a 101 hard call provision, originally scheduled to end in May 2013, to a 101 soft call provision ending in August 2013.
The company stated that all other principal provisions, including maturity and covenants under the Company's existing credit agreement, comprised of the term loan facility and a $50 million revolving credit facility, remain unchanged.
The company said it expects to incur approximately $4.1 million in fees and expenses in connection with the amendment, including a 1.0% amendment fee of $2.7 million and $1.4 million of related bank and legal fees.
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