WALNUT CREEK, Calif., July 17, 2017 /PRNewswire/ -- ARC Document Solutions, Inc. (NYSE: ARC) announced today that it entered into an amendment to its credit facility which reduced the Term A loan to $60 million and increased the revolving line of credit to $80 million. The balance of the outstanding debt under the credit facility remains unchanged at $110 million.
"Our focus on generating cash and reducing our debt has allowed us to renegotiate our current agreement to more favorable terms," said Suri Suriyakumar, Chairman, CEO of ARC. "The amended and restated agreement not only improves our capital structure, but more importantly, it allows us significant flexibility in terms of investing in and operating the business during its transition."
The amendment to the credit facility reduced the per annum floating interest rate that is adjusted quarterly based on the Company's leverage ratio by 25 basis points across the board. Based on ARC's current leverage ratio of less than 2.5 times, the Company's interest rate, effective July 14, 2017, will be LIBOR plus 175 basis points. Annual amortization charges under the amended facility are projected to drop from $17.5 million to $4.5 million, a reduction of $13 million, and the agreement features fewer restrictions on ARC's uses of excess cash.
The credit facility was reallocated among its lenders and has a restated term of five years that matures in July 2022.
Wells Fargo Securities was the Lead Arranger on the transaction.
About ARC Document Solutions (NYSE: ARC)
ARC Document Solutions distributes documents and information to facilitate communication for design, engineering and construction professionals, real estate managers and developers, facilities owners, and a variety of similar disciplines. The Company provides cloud and mobile solutions, professional services, and hardware to help its customers around the world reduce costs and increase efficiency, improve information access and control, and communicate faster, easier, and better. Follow ARC at www.e-arc.com.
This press release contains forward-looking statements that are based on current opinions, estimates and assumptions of management regarding future events and the future financial performance of the Company. All statements other than statements of historical fact, including, but not limited to, any projections regarding the financial performance of the Company, could be deemed forward-looking statements. We caution you that such statements are only predictions and are subject to certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements. In addition to matters affecting the construction, managed print services, document management or reprographics industries, or the economy generally, factors that could cause actual results to differ from expectations stated in forward-looking statements include, among others, the factors described in the caption entitled "Risk Factors" in Item 1A in ARC Document Solution's Annual Report on Form 10-K for the fiscal year ended December 31, 2016, Quarterly Reports on Form 10-Q, and other periodic filings and prospectuses. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.
SOURCE ARC Document Solutions