The One Group Hospitality, Inc. Announces the Closing of New Credit Facility
May 16 2019 - 9:00AM
Business Wire
Estimated Interest Expense Savings to Exceed
$0.4 Million Annually.
Estimated Reduction in Annual Loan Repayments
to Exceed $2.0 Million Annually.
The ONE Group Hospitality, Inc. (“The ONE Group” or the
“Company”) (Nasdaq: STKS) announced the successful closing of a new
credit facility on May 15, 2019 that includes a $10.0 million term
loan and a new $10.0 million revolving credit facility. The new
credit facility bears an interest rate of LIBOR plus a margin that
can fluctuate between 2.75% and 3.50% (based on a consolidated
rent-adjusted leverage ratio). The proceeds from the new credit
facility will be used to retire the Company’s existing debt, to pay
transaction costs associated with the refinancing, and for general
corporate purposes. Upon the completion of the refinancing, the
Company will have approximately $11.7 million of total debt
outstanding.
Based on current market conditions, the refinancing represents a
240 to 290 basis point reduction in the Company's borrowing costs
and is expected to reduce annual interest expense by approximately
$0.4 to $0.5 million per year. The Company expects the reduction in
annual loan repayments to be in excess of $2.0 million annually.
The reduction in loan repayments is based on a 7.5% annual
amortization of the term loan over a five-year period with the
remainder to be paid at the end of the fifth year.
Emanuel “Manny” Hilario, President and CEO of The ONE
Group stated, "As a result of our strong financial
performance, we are thrilled to have a new credit facility which
allows us to strengthen our capital structure. This
refinancing will help to reduce our interest expense and provides
us with greater flexibility to execute on the whitespace
opportunity ahead."
Bank of America acted as the sole lender of the new credit
facility.
About The ONE Group
The ONE Group (NASDAQ: STKS) is a global hospitality company
that develops and operates upscale, high-energy restaurants and
lounges and provides hospitality management services for hotels,
casinos and other high-end venues both nationally and
internationally. The ONE Group’s focus is to be the global leader
in Vibe Dining, and its primary restaurant brand is STK, a modern
twist on the American steakhouse concept with locations in major
metropolitan cities in the U.S., Europe and the Middle East. ONE
Hospitality, The ONE Group’s food and beverage hospitality services
business, develops, manages and operates premier restaurants and
turn-key food and beverage services within high-end hotels and
casinos. Additional information about The ONE Group can be found at
www.togrp.com
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Investors:ICRMichelle Michalski, (646) 277-1224
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