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| Larry Bentley |
Proceeds from fast food chain The Krystal Co.'s new $90 million credit facility were used to take out the company's $60.9 million 10 1/4% senior notes due 2007. Krystal previously only had a revolver, but has now added term debt. The new deal comprises a $40 million "A" loan, $25 million "B" loan and $25 million revolver. "It gives us a lot more flexibility. Much more flexibility than we had with just senior notes in terms of the ability to make investments in other businesses and also creates a much more efficient mechanism for reducing debt going forward," said Larry Bentley, Krystal's senior v.p. and cfo.
The facility has matrix pricing based on covenants, but Bentley declined to disclose the spread. "The interest rates were right, [the] bank market was right and we were able to get a senior bank deal done at what we through were favorable terms," Bentley noted, on the timing of the deal. Bank of America leads the facility. "We went through a competitive bidding process and they came to the table with the most attractive package," Bentley said. He declined to name the other bidders. B of A also led the company's previous revolver.