EZCorp (EZPW), the parent of well-known pawn shop EZ Pawn, secured up to as much as $225 million in a revolving line of credit. The credit agreement is secured by various unnamed lenders and administered by Wells Fargo.
The new credit line replaces an $80 million line and a $40 million term loan that were both set to expire in the next 18 months. EZ paid down about $22.5 million in
debt on those loans from cash.
EZ Corp will pay an interest rate that shifts with a variety of factors, including the changes in the London Inter Bank Overnight Rate as well as their own internal debt and equity ratios.
EZ Corp put up all of its assets, plus all of its equity in its domestic operations, plus up to 65 percent of equity in its foreign subsidiaries.
EZ Corp operates pawn shops in 11 states, most of which are in the Southeast. They offer short-term pawn loans, auto title loans, as well as unsecured "signature loans."
EZ Corp is a fast growing company with relatively little debt. See their balance sheet here.
EZ Corp is headquartered in Austin, Texas. Austin might be emerging as a new cluster for alternative financial services providers. Their home base is about 11 minutes away from the headquarters of NetSpend. Of course, it will be a long time before they can claim to unseat suburban Atlanta for the dubious title of crossroads of the unbanked.