This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Sport Chalet Signs New Credit Facility, Advances Business Strategy

Company Negotiates $65 Million Credit Line From Bank of America Engages Real Estate Advisor to Refine Store Strategy

LOS ANGELES, Oct. 21, 2010 (GLOBE NEWSWIRE) -- Sport Chalet, Inc. (Nasdaq:SPCHA) (Nasdaq:SPCHB) today announced the next steps in its business strategy, including the signing of a new four-year $65 million credit agreement with Bank of America, N.A.

Craig Levra, Chairman and CEO of Sport Chalet, said, "With its favorable terms, especially in view of an extremely tight credit market, our agreement represents a strong vote of confidence in Sport Chalet by one of the nation's leading lenders. We felt it was prudent to establish a new credit facility well before the previous one was set to mature. The increased borrowing capacity provides us with tremendous flexibility to support our strategic initiatives and to enhance our vendor relationships."

The Company was able to borrow on more favorable terms and conditions. The credit facility has increased availability to $65 million from $45 million and contains revised financial covenants, which gives the Company greater financial flexibility. The new facility also reduces the interest rate, which is expected to reduce interest expense by approximately $800,000 on an annualized basis, based on current borrowing forecasts. The seasonal revolving credit line, from September 1 to December 31, remains unchanged at $70 million. The new agreement extends the expiration date to October 2014.

Bank of America revised the financial covenant regarding earnings before interest, taxes and depreciation (EBITDA). Under the previous facility, the Company was required to maintain a minimum monthly EBITDA on a trailing twelve month basis. To increase the Company's financial flexibility, the revised covenant, which raises the trailing twelve month minimum EBITDA by $500,000 every six months, is only calculated when the Company's availability on the credit facility is below specified amounts. On October 18, 2010, the Company had $16 million in availability, $10 million above the specified amount of $6 million.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG

Markets

DOW 17,683.58 -46.53 -0.26%
S&P 500 2,068.76 -8.02 -0.39%
NASDAQ 4,991.94 -17.2740 -0.34%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs