L.O.T.W. #135 - Mama's Creations cooks up expanded credit relationship with M&T Bank
$27.5M senior secured facility and $20.0M equity raise fund Mama’s Creations’ acquisition of Crown I Enterprises from Sysco
Mama’s Creations entered into an amended and restated credit agreement with M&T Bank, adding a $20.0 million permitted acquisition (“PA”) line while restating the terms of its existing term loan and revolving facility
👓At a Glance
Borrower: Mama’s Creations
Lender: M&T Bank
Deal Size: ~$27.5 million aggregate commitment
$20.0 million permitted acquisition (“PA”) term loan
$5.5 million revolving line of credit
$1.87 million amortizing term loan
Structure:
PA loan - non-revolving delayed draw term loan with 60-day window between initial advance and conversion to amortizing term loan w/ 25% excess cash flow sweep
Revolving line - interest only on outstanding balances; principal due at maturity
Term loan - fully amortizing over seventeen months
Rate: Variable based on senior funded debt / EBITDA
Term:
PA Loan - ~ 24 month draw window; 60 month amortization period starting 60 days after each advance
Revolving line - ~27 months
Term loan - 17 months from close
Use of Proceeds: Support working capital and the acquisition of Crown I Enterprises
Source: Press Release
📷Borrower Snapshot
Sector: Consumer Staples
Subsector: Food Products
Ownership: Public (NASDAQ: MAMA)
Commercial Stage: Revenue generating; LTM EBITDA +
Business Overview: Mama’s Creations is a branded prepared foods company supplying more than 10,000 supermarkets and mass retailers nationwide with a portfolio spanning proteins, salads, olives, and international cuisine. Founded on the legacy MamaMancini’s brand, the company has evolved into a “one-stop shop” deli solutions provider, catering to shifting consumer demand for fresh, clean-label, ready-to-eat meals.
⚙️Structure & Terms
Source: SEC 8-K Filing
Commitment:
PA Loan - $20 million delayed draw term loan; $19.0 was advanced at close
Revolving line - $5.5 million non-formula based cashflow dependent revolving line of credit
Term loan - $1.8 million amortizing term loan
Maturity:
PA loan - 60 months from amortization commencement date
Revolving line - November 28, 2028
Term loan - January 15, 2027
Collateral: Senior secured all asset lien
Rate: Variable based on senior funded debt / EBITDA
when ratio is >2.25; 3.50% above variable loan rate
when ratio i >1.50 <= 2.25; 3.00% above variable loan rate
when ratio <=1.50; 2.50% above the variable loan rate
variable loan rate is daily simple SOFR for the term revolving loan, term loan, and PA loan prior to permanent period. After PA loan is converted to an amortizing term loan, applicable index rate will be 1 month term SOFR
Fees:
$60k upfront commitment fee
0.25% advance fee on each PA advance
0.25% unused line fee
Financial Covenants:
Fixed Charge Coverage not to fall below 1.25:1.00
Total Funded Debt / EBITDA not to exceed 3.75:1.00
Total Senior Funded Debt / EBITDA not to exceed 2.75: 1.00
Seeing posts with the entire structure, including pricing and covenants is so helpful!