Express enters $140M credit agreement with FILO, delayed-draw term loans

Express Inc. entered into a $140 million asset-based term loan agreement to boost liquidity as the apparel and accessories company navigates the COVID-19 pandemic. Wells Fargo is administrative agent.

Sycamore Partners is lead lender under the loan agreement, alongside Wells Fargo and Bank of America Merrill Lynch.

The new financing includes a $90 million first in, last out term loan due 2024 and a $50 million delayed draw term loan, to be repaid upon receipt of a CARES Act tax refund expected in the second quarter of 2021. Pricing is L+800-825, based on trailing 12-month EBITDA, according to a Jan. 14 regulatory filing.

Proceeds of the FILO term loan and delayed-draw term loan are for working capital and general corporate purposes. Borrowings under the FILO term loan will be repaid 1.25% per quarter beginning in January 2022. The term loan is subject to a borrowing base and maintenance of minimum excess availability.

The new loans are in addition to the company's $250 million asset-based loan facility, of which $165 million is drawn. The borrower amended the asset-based loan agreement, including adding a borrowing base calculated weekly. Pricing has been increased 75 basis points, to L+200-225. The loan agreement is subject to an unused line fee of 20 bps-37.5 bps, depending on excess availability.