Saratoga Investment Corp., a business development company, announced its wholly owned subsidiary, Saratoga Investment Funding II LLC (SIF II), an entity formed for purposes of entering into this financing arrangement, closed a new $50.0 million senior secured credit facility with Encina Lender Finance, LLC. The Facility will be supported by loans held by SIF II and pledged to Encina under the terms of the credit agreement.
The Facility closed on Oct. 4. SIF II may request an increase in the commitment amount to up to $75.0 million during the first two years. The terms of the Facility require a minimum drawn amount of $12.5 million at all times during the first six months, which increases to the greater of $25.0 million or 50 percent of the commitment amount in effect at any time thereafter. The term of the Facility is three years. The interest rate on the borrowings under the Facility isLIBOR plus 4.0 percent, with LIBOR having a floor of 0.75 percent. Concurrently with the closing of this Facility, all remaining amounts outstanding on the Company’s existing revolving credit facility with Madison Capital Funding, LLC were repaid and the facility terminated.
“We are pleased to close this credit facility with Encina, which provides the Company with a great deal of flexibility as we assess our needs and seek to optimize our overall capital structure. Encina has been an excellent partner in this process, and we appreciate the opportunity to establish this new relationship with them,” said Christian L. Oberbeck, Chairman and Chief Executive Officer of Saratoga Investment.
“Encina Lender Finance is pleased that Saratoga Investment has selected us as a key senior debt capital partner,” said Luke Graham, Chief Executive Officer of Encina. “The Company’s management team has a long and distinguished track record of success, and we look forward to supporting them in achieving Saratoga Investment’s future goals and objectives.”
Headquartered in Atlanta, GA, ELF offers revolving lines of credit and term loans ranging in size from $10 million to $150 million to specialty finance companies (sponsored and non-sponsored) across a wide range of asset classes including, but not limited to, asset-based lending, factoring, equipment leasing, floorplan financing, commercial real estate bridge lending, tax lien/deed financing, venture debt lending, SMB lending & merchant cash advance, middle-market private credit, charged-off debt buyers, rent-to-own consumer leasing, unsecured consumer lending and specialized student lending. ELF’s customers use financing proceeds primarily to fund the origination of new finance contracts and to refinance existing debt, and ELF’s loans are secured by portfolios of notes, loans and/or leases.