American Public Education completes $130 million credit facility refinancing

American Public Education Inc. (NASDAQ: APEI) completed a refinancing with a new five-year, $130 million senior secured credit facility, the company announced March 12.

The new facility consists of a $90 million senior secured term loan and a $40 million senior secured revolving credit facility. The arrangement reduces the company's borrowing spread by 375 basis points based on current leverage levels and is expected to generate approximately $3.7 million in annual interest savings.

PNC Bank, National Association serves as administrative agent and collateral agent, with PNC Capital Markets LLC acting as joint lead arranger and sole bookrunner. M&T Bank, N.A. participates as a joint lead arranger alongside a syndicate of lenders.

The facility matures March 9, 2031, with borrowings subject to a revolver commitment fee ranging from 0.20% to 0.35%. Interest rates equal SOFR plus between 1.75% and 2.75% depending on the company's consolidated total net leverage ratio.

Proceeds from the new facility, combined with cash on hand, were used to refinance the company's existing $20 million senior secured revolving credit facility and repay approximately $96.4 million outstanding under its prior $175 million senior secured term loan.

"This transaction delivers three concrete improvements to our capital structure: an approximately 375 basis point reduction in our borrowing spread based on current leverage levels, a reduction in our total debt balance, and a five-year extension of our maturity runway to 2031," said Edward Codispoti, executive vice president and chief financial officer.

The company expects to record a one-time loss on extinguishment of debt of approximately $1.6 million in the first quarter of 2026, primarily related to the write-off of unamortized deferred financing costs.

American Public Education provides online and campus-based postsecondary education to approximately 109,000 students through its institutions American Public University System, Rasmussen University, and Hondros College of Nursing.

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