Horizon Health Corp. added Key Bank to its revolver syndicate during an amendment because of a prior banking relationship with Joanne Bramanti, who joined Key in February, noted Greg Flynn, Horizon's controller and assistant treasurer. Bramanti said Horizon knows her from J.P. Morgan Chase, where she worked with the company. But the relationship play does not stop there. After nearly five years at J.P. Morgan, Bramanti spent a couple of years at Wells Fargo and developed a relationship between that bank and Horizon, she said. J.P. Morgan leads the revolver with Wells Fargo and Bank of America as the other lenders. Bramanti spent 13 years at B of A -- but that was before she worked at J.P. Morgan so she had not hooked up with Horizon yet.
The only bank Bramanti worked at that is not in the credit is Washington Mutual, where she ran the commercial banking group for 18 months before joining Key. She's now a senior v.p. at Key leading the opening of Key's Dallas/Fort Worth commercial banking office.
Key has a nationwide presence, but has previously not had commercial banking in Texas, said Bramanti. There are currently five people working on commercial banking in the Dallas office and Key will be hiring a couple more relatively soon, she said. Key has been calling the market from the large corporate side, in real estate and equipment finance, but is now covering the middle market through Bramanti's office. "Since commercial banking is focused on middle market and relationships we feel we bring the full depth of products to those companies," Bramanti noted. "Horizon is a great example of a relationship we would use our balance sheet for."
All of Horizon's existing lenders stayed in and increased their commitment. "Our bank group has been extremely supportive," Flynn said. The amendment increased the size of Horizon's revolver from $60 million to $90 million with an accordion feature that could take it up to $120 million. The larger facility extends a line that was in place one year and provides additional capital for Horizon's acquisition objectives, Flynn explained.
The revolver matures in two years. At the end of the two years, if it has not been extended or replaced, it will convert into a two-year term loan, Flynn noted. The interest rate, which stayed the same with the amendment, is based on a grid tied to leverage and ranges from LIBOR plus 2-3%. Prior to the amendment, Horizon was paying LIBOR plus 2% but is now paying LIBOR plus 2 3/4%, "because there is an interim grid level that we have to pay regardless of what our leverage is until the end of next quarter," Flynn said.