AMARILLO, Texas, July 26, 2011 /PRNewswire via COMTEX/ --
Hastings Entertainment, Inc. (NASDAQ: HAST), a leading multimedia entertainment retailer, on July 21, 2011, entered into an amendment (the "First Amendment") to the Amended and Restated Loan and Security Agreement with Bank of America, N.A., acting in its capacity as agent for various lenders identified therein (the "Agreement").
The First Amendment increases the revolving credit facility from $100,000,000 to $115,000,000 and also increases the Company's advance rate on eligible inventory.
Prior to the First Amendment, the Base Margin (as defined in the Agreement) was between 1.0% and 1.75%, and the Libor Margin (as defined in the Agreement) was between 2.0% and 2.75%, depending on the level of average availability under the facility. Under the First Amendment, the range of the Base Margin is between 1.0% and 1.50% and the range of the Libor Margin is between 2.0% and 2.50%, depending on the level of availability under the facility. In both cases, the greater the availability, the lower the applicable Margin.
The First Amendment also allows the payment of dividends, upon the satisfaction of certain conditions. The payment of dividends was previously prohibited under the Agreement. The First Amendment includes a change in the financial performance covenant that requires the Company, at all times, to maintain availability that is greater than or equal to 10% of the lesser of (a) the Borrowing Base (as defined in the Agreement), and (b) the Revolving Credit Ceiling (as defined in the Agreement), but no less than $10 million, at all times.
"Amending our loan will enable us to lower our anticipated cost of capital and enhance our financial flexibility," said John H. Marmaduke, Chief Executive Officer and Chairman. "We appreciate the strong level of support we received from Bank of America, N.A."
To obtain the complete text of the First Amendment, please refer to our Form 8-K filed with the Securities and Exchange Commission (the "SEC") on July 26, 2011. This document is available at www.sec.gov or at our investor relations website located at www.goHastings.com.
Founded in 1968, Hastings Entertainment, Inc. is a leading multimedia entertainment retailer that combines the sale of new and used books, videos, video games and CDs, as well as trends and consumer electronics merchandise, with the rental of videos and video games in a superstore format. We currently operate 145 superstores, averaging approximately 24,000 square feet, primarily in medium-sized markets throughout the United States. We also operate a concept store, Sun Adventure Sports, in Amarillo, Texas.
We operate www.goHastings.com, an e-commerce Internet website that makes available to our customers new and used entertainment products and unique, contemporary gifts and toys. The site features exceptional product and pricing offers. The Investor Relations section of our website contains press releases, a link to request financial and other literature and access our filings with the Securities and Exchange Commission.
SOURCE Hastings Entertainment, Inc.