NEW HAVEN, Conn. -- Proliance International has signed a letter of intent with a group of institutional lenders that will provide $30 million of mezzanine financing to the company. The mezzanine financing is part of a previously announced package of debt and/or equity the company has been seeking to fully or partially replace its current lead lender.
The letter of intent provides exclusivity for the proposed lenders while they complete due diligence and negotiate definitive agreements. Completion of this financing, tentatively expected in the fourth quarter, is subject to closing conditions, including satisfactory completion of due diligence, the company establishing a new senior secured credit facility with a new lender and execution of the aforementioned definitive agreements. Preliminary terms of the proposed transaction are subject to a confidentiality agreement between the parties. Proliance is currently in discussions with several financial institutions to provide a new senior secured credit facility to the company.
The company also announced that its current lenders have signed an eighth amendment to the company’s credit agreement, enabling Proliance temporary access to an additional $2.5 million from its current lenders, representing a relaxation of prior loan restrictions on a portion of the insurance settlement received earlier this year for the casualty event at Proliance’s Southaven, Miss., facility. The amendment also provides for an additional $2.5 million of borrowing capacity that will become temporarily available upon Proliance’s signing of a definitive agreement to fund the mezzanine and senior secured credit facility financings.
