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PRA Group amends and extends North American credit facility
By Marisa Wong
Los Angeles, Aug. 2 – PRA Group, Inc. amended its North American credit agreement on July 30 to modify pricing and covenants and to extend the maturity date, according to a news release.
Libor, CDOR and Eurodollar base rate floors were decreased to zero from 0.75% for revolving loans.
For Eurodollar rate loans, CDOR loans and letter-of-credit fees, the applicable rate was reduced to 225 basis points from 250 bps or, if the consolidated senior secured leverage ratio is less than or equal to 1.60 to 1.0, to 200 bps from 225 bps.
The unused fee was reduced to 35 bps from 37.5 bps or, if the consolidated senior secured leverage ratio is less than or equal to 1.60 to 1.0, to 30 bps from 37.5 bps.
Libor replacement provisions were updated to reflect the current market approach as well.
In addition, the maturity date of the agreement has been extended to July 30, 2026 from May 5, 2024.
PRA Group also amended, among other things, negative covenants, including (i) increasing the limit on stock repurchases and the redemption of convertible notes to the sum of $150 million per year and 50% of consolidated net income for the previous fiscal year and (ii) excluding PRA’s foreign subsidiaries from the limitations on incurring liens and entering into burdensome agreements.
“The current market conditions provided us the opportunity to amend and extend our North American credit agreement on favorable terms. This amendment provides PRA with additional flexibility, further diversifies our maturity profile and decreases overall costs on the facility,” Pete Graham, executive vice president and chief financial officer for PRA, commented in the release.
Based in Norfolk, Va., PRA acquires and collects nonperforming loans.
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