SAN DIEGO--(BUSINESS WIRE)--Mar. 21, 2018--
Jack in the Box Inc. (NASDAQ: JACK) today announced completion of an
amendment to its existing senior credit facility. The maturity date for
both the revolving credit facility and the term loan was extended to
March 2020.
The amendment also raised the maximum leverage ratio covenant from 4.0
times to 4.5 times, and allows unlimited cash dividends and share
repurchases if pro forma leverage is less than 4.0 times (from 3.5 times
previously), subject also to pro forma fixed charge covenant compliance.
The interest rate on the senior credit facility is based on the
company’s leverage ratio and can range from LIBOR plus 1.25 percent to
LIBOR plus 2.25 percent. The interest rate immediately after giving
effect to the amendment was LIBOR plus 2.00 percent.
In connection with today’s sale of Qdoba Restaurant Corporation, the
company will make a prepayment of $260 million to retire outstanding
debt under its term loan, as required by the terms of its credit
facility. Following the paydown of the term loan and the amendment on
March 21, 2018, approximately $365.7 million was outstanding on the term
loan and approximately $599.4 million was drawn or used for letters of
credit under the $900 million revolving credit facility.
“We’re pleased that our lenders have the confidence in our business
model to increase our borrowing capacity without waiting for completion
of our refranchising strategy,” said Lenny Comma, chairman and chief
executive officer of Jack in the Box Inc. “We remain comfortable with
ultimately increasing our leverage to 5.0 times EBITDA. The
extension of our credit facility is an interim step that provides an
immediate increase in our borrowing capacity to 4.5 times EBITDA while
we work with our advisors to evaluate longer-term financing
alternatives.”
Wells Fargo Securities, LLC served as lead arranger and lead bookrunner
for the amendment.
About Jack in the Box Inc.
Jack in the Box Inc. (NASDAQ: JACK), based in San Diego, is a restaurant
company that operates and franchises Jack in the Box® restaurants, one
of the nation’s largest hamburger chains, with more than 2,200
restaurants in 21 states and Guam. For more information on Jack in the
Box, including franchising opportunities, visit www.jackinthebox.com.
Safe harbor statement
This press release contains forward-looking statements within the
meaning of the federal securities laws. Such statements are subject to
substantial risks and uncertainties. A variety of factors could cause
the company’s actual results to differ materially from those expressed
in the forward-looking statements, including the following: the success
of new products and marketing initiatives; the impact of competition,
unemployment, trends in consumer spending patterns and commodity costs;
the company's ability to reduce G&A; the company's ability to execute
its refranchising strategy; the company’s ability to achieve and manage
its planned growth, which is affected by the availability of a
sufficient number of suitable new restaurant sites, the performance of
new restaurants, and risks relating to expansion into new markets;
litigation risks; food safety incidents or negative publicity impacting
the reputations of the company's brands; and stock market volatility.
These and other factors are discussed in the company’s annual report on
Form 10-K and its periodic reports on Form 10-Q filed with the
Securities and Exchange Commission which are available online at http://investors.jackinthebox.com
or in hard copy upon request. The company undertakes no obligation to
update or revise any forward-looking statement, whether as the result of
new information or otherwise.
View source version on businesswire.com: https://www.businesswire.com/news/home/20180321005745/en/
Source: Jack in the Box Inc.
Jack in the Box Inc.
Investor Contact:
Carol
DiRaimo, (858) 571-2407
or
Media Contact:
Brian
Luscomb, (858) 571-2291