On July 24th, Tandy Brands Accessories, Inc. entered into a new credit agreement with Salus Capital Partners, LLC, to provide senior financing up to $29 million. The facility is comprised of a revolving credit facility in the amount of $27.5 million, and a term loan facility in the amount of $1.5 million, and expires in July 2015. Under the Credit Facility, borrowings bear interest at either the base rate or LIBOR, plus an additional percentage for each of the revolver and the term loan.

The Credit Facility is secured by a first priority lien on substantially all of the assets of the company and its subsidiaries, excluding certain goods and related accounts receivable financed pursuant to the King Trade Facility, for which Salus will have a second priority lien. The Credit Facility contains covenants which address minimum consolidated EBITDA requirements, account concentration limitations, budgeted expenses and accounts payable to inventory ratios. The Credit Agreement also provides for customary representations, warranties, affirmative covenants, negative covenants and events of default.

The company used the proceeds of the initial advance under the Credit Facility to repay indebtedness owing to Wells Fargo and to pay fees and expenses incurred in connection with the Credit Agreement. The company will use the proceeds of future advances under the Credit Agreement for working capital purposes.