Maintains Low Floating Interest Rate Based on Total Leverage Ratio; Revolver set at $70 million.
San Ramon, Calif. – ARC Document Solutions, Inc. announced today that it entered into a new, five-year revolving line of credit in the amount of $70 million, replacing the Company's former credit agreement dated November 20, 2014. The new agreement features terms similar to the former credit agreement, including the ability to use excess cash of up to $15 million per year for restricted payments such as share repurchases and dividends. The new agreement matures in April 2026.
"Despite the challenging conditions of the past year, ARC has demonstrated consistency and strength in its ability to generate cash and reduce its debt," said Suri Suriyakumar, Chairman, CEO of ARC. "The new agreement maintains our solid capital structure, supports our commitment to returning shareholder value, and provides significant flexibility to capitalize on new opportunities and grow the business over the next five years."
The new revolving credit line bears interest at per annum floating rates that are adjusted quarterly based on the Company's leverage ratio. Based on ARC's total leverage ratio at the closing, the Company's interest rate effective April 22, 2021, is LIBOR plus 150 basis points.
U.S. Bank National Association was the Lead Arranger on the transaction. BMO Harris Bank N.A. was the Syndication Agent.
Follow ARC at www.e-arc.com.