$8,500,000 credit facility renewal for marketing services provider

$8,500,000 Multi-Year Renewal of Credit Facility

Increase Availability for Marketing Services Provider

CLIENT

A specialist in the marketing services industry, this company provides specialized marketing programs that enable members of affinity groups to earn frequent-flyer miles and other loyalty rewards through purchases at participating merchants.

SITUATION

The renewed agreement is for a multi-year term ending in December 2021 and allows for automatic renewal thereafter for periods of one year unless either party gives termination notice.

The credit facility has a limit of $8.5 million. The current utilization by the Company is about $4.2 million.

FINANCIAL SOLUTION

The renewed and enhanced credit facility together with the access to additional working capital will have a positive impact following the completion of the company’s recently announced restructuring. The working capital will be used in the transition to the next phase of recovery of the company’s core business during which it expects a gradual but sustained growth in its CIBC/TD program merchant base and related revenues. The renewed agreement also carries more beneficial terms, effective immediately, in terms of interest rate and margin funding formula. 

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