Universal Technical Institute, Inc., a provider of motorcycle and auto technical training, said it terminated its $30.0 million credit facility with Heller Financial, Inc., effective Sept. 30, 2004.
UTI said it hopes to secure a lower-cost credit facility with Wells Fargo Bank. The change in lenders, the company said, will result in a one-time, fourth quarter charge of approximately $400,000 “related to the write-off of unauthorized deferred financing costs,” prepaid loan administration fees and legal costs. UTI said it expects to save approximately $400,000 in annual interest cost savings under the new credit facility.
At the time of the termination, the UTI had no outstanding borrowings under the credit facility. The credit facility had been used to secure a letter of credit in favor of the Department of Education related to the company's Title IV funding eligibility. UTI plans to secure this existing letter of credit with cash until its expiration or replacement in November 2004.
UTI also said it plans to issue a replacement letter of credit to the Department of Education under the new facility prior to the November expiration of the current letter of credit.
Universal Technical Institute, Inc., provides technical education training for students seeking careers as professional automotive, diesel, collision repair, motorcycle and marine technicians. UT’s brands include Universal Technical Institute (UTI), Motorcycle Mechanics Institute and Marine Mechanics Institute (MMI) and NASCAR Technical Institute (NTI).
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