Alliance Entertainment Announces Closing of New 3-Year $120 Million Senior Secured Credit Facility
December 21 2023 - 6:30PM
Alliance Entertainment Holding Corporation (Nasdaq: AENT)
(“Alliance Entertainment”, “Company”), a distributor and wholesaler
of the world’s largest in stock selection of music, movies, video
games, electronics, arcades, toys and collectibles, today announced
the closing of a new 3-year $120 million senior secured asset based
credit facility with White Oak Commercial Finance, LLC. This credit
facility replaces the Company’s revolver with Bank of America.
The new credit facility includes a $120 million
asset based revolving credit facility (the “Revolver”). The
Revolver will bear interest at a rate of the 30-day SOFR plus 4.5%,
Borrowings from the facility will primarily be used to retire the
existing credit facility, fund working capital needs and provide
for general corporate purposes.
Jeff Walker, CEO & CFO of Alliance Entertainment, commented,
“We will be entering 2024 with lowering borrowing needs so we
elected to reduce our line to control costs.“
Bruce Ogilvie, Chairman of Alliance, commented,
“We are now well positioned to continue to execute strategic plans
including investments in automating facilities and upgrading
proprietary software, improvements which we believe will improve
EBITDA and inventory turns. We believe that in combination with our
cost-cutting initiatives and reduction in inventory due to improved
management, lowering our cost of capital directly improves our
competitiveness and increases our ability to deploy capital that
drives accretive growth. We are delighted to have the support of
White Oak, which shares our long-term vision for Alliance
Entertainment with a focus on strategy, operational execution, and
financial prudence."
About Alliance
Entertainment
Alliance Entertainment (NASDAQ: AENT) is a
premier distributor of music, movies, toys, collectibles, and
consumer electronics. We offer over 375,000 unique in stock SKU’s,
including over 57,300 exclusive compact discs, vinyl LP records,
DVDs, Blu-rays, and video games. Complementing our vast media
catalog, we also stock a full array of related accessories, toys
and collectibles. With more than thirty-five years of distribution
experience, Alliance Entertainment serves customers of every size,
providing a robust suite of services to resellers and retailers
worldwide. Our efficient processing and essential seller tools
noticeably reduce the costs associated with administrating multiple
vendor relationships, while helping omni-channel retailers expand
their product selection and fulfillment goals. For more
information, visit www.aent.com.
Forward Looking Statements
Certain statements included in this Press
Release that are not historical facts are forward-looking
statements for purposes of the safe harbor provisions under the
United States Private Securities Litigation Reform Act of 1995.
Forward-looking statements generally are accompanied by words such
as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,”
“intend,” “expect,” “should,” “would,” “plan,” “predict,”
“potential,” “seem,” “seek,” “future,” “outlook,” and similar
expressions that predict or indicate future events or trends or
that are not statements of historical matters. These
forward-looking statements include, but are not limited to,
statements regarding estimates and forecasts of other financial and
performance metrics and projections of market opportunity. These
statements are based on various assumptions, whether identified in
this Press Release, and on the current expectations of Alliance’s
management and are not predictions of actual performance. These
forward-looking statements are provided for illustrative purposes
only and are not intended to serve as and must not be relied on by
an investor as, a guarantee, an assurance, a prediction, or a
definitive statement of fact or probability. Actual events and
circumstances are difficult or impossible to predict and will
differ from assumptions. Many actual events and circumstances are
beyond the control of Alliance. These forward-looking statements
are subject to a number of risks and uncertainties, including risks
relating to the anticipated growth rates and market opportunities;
changes in applicable laws or regulations; the ability of Alliance
to execute its business model, including market acceptance of its
systems and related services; Alliance’s reliance on a
concentration of suppliers for its products and services; increases
in Alliance’s costs, disruption of supply, or shortage of products
and materials; Alliance’s dependence on a concentration of
customers, and failure to add new customers or expand sales to
Alliance’s existing customers; increased Alliance inventory and
risk of obsolescence; Alliance’s significant amount of
indebtedness; our ability to refinance our existing indebtedness;
our ability to continue as a going concern absent access to sources
of liquidity; risks and failure by Alliance to meet the covenant
requirements of its revolving credit facility, including a fixed
charge coverage ratio; risks that a breach of the revolving credit
facility, including Alliance’s recent breach of the covenant
requirements, could result in the lender declaring a default and
that the full outstanding amount under the revolving credit
facility could be immediately due in full, which would have severe
adverse consequences for the Company; known or future litigation
and regulatory enforcement risks, including the diversion of time
and attention and the additional costs and demands on Alliance’s
resources; Alliance’s business being adversely affected by
increased inflation, higher interest rates and other adverse
economic, business, and/or competitive factors; geopolitical risk
and changes in applicable laws or regulations; risk that the
COVID-19 pandemic, and local, state, and federal responses to
addressing the pandemic may have an adverse effect on our business
operations, as well as our financial condition and results of
operations; substantial regulations, which are evolving, and
unfavorable changes or failure by Alliance to comply with these
regulations; product liability claims, which could harm Alliance’s
financial condition and liquidity if Alliance is not able to
successfully defend or insure against such claims; availability of
additional capital to support business growth; and the inability of
Alliance to develop and maintain effective internal controls.
For investor inquiries, please
contact:MZ GroupChris Tyson/Larry
Holub(949) 491-8235AENT@mzgroup.us
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