UPC Distribution seeks €400 million term loan F

By Sara Rosenberg

New York, Oct. 18 - UPC Distribution Holding BV, a wholly owned subsidiary of UnitedGlobalCom Inc., is seeking a new €400 million term loan F due Dec. 31, 2011 under its existing €1.072 billion senior secured credit facility, according to an 8-K filed with the Securities and Exchange Commission Monday.

BNP Paribas and TD Securities Inc. are the lead arrangers and bookrunners on the deal.

The term loan F would be comprised of a euro tranche and a U.S. tranche. The euro tranche will carry an interest rate of Libor plus 400 basis points with a stepdown to Libor plus 325 basis points if senior debt to EBITDA falls below 3.50-to-1, and the U.S. tranche will carry an interest rate of Libor plus 350 basis points with a stepdown to Libor plus 300 basis points if senior debt to EBITDA falls below 3.50-to-1, the filing said.

Financial covenants include ratio of senior debt to annualized EBITDA and ratio of EBITDA to senior interest (table 1), ratio of EBITDA to total cash interest (table 2), EBITDA to senior debt service (table 3) and total debt to annualized EBITDA (table 4).

Proceeds can be used to prepay some or all of the existing term loan B and/or term loan C, repay revolving credit facility A borrowings that were or would be used for acquisitions and/or finance an additional permitted acquisition.

UPC is the subsidiary that holds and operates Denver-based UnitedGlobalCom's broadband network business in 11 European countries.

Table 1: Ratio of senior debt to annualized EBITDA and ratio of EBITDA to senior interest

Test dates Senior debt to EBITDA EBITDA to senior interest

Dec. 31, 2004 4.90-to-1 2.65-to-1

March 31, 2005 4.80-to-1 2.80-to-1

June 30, 2005 4.60-to-1 2.85-to-1

Sept. 30, 2005 4.40-to-1 3.05-to-1

Dec. 31 2005 4.10-to-1 3.15-to-1

Thereafter 4.00-to-1 3.40-to-1

Table 2: Ratio of EBITDA to total cash interest

Test dates EBITDA to total cash interest

Dec. 31, 2004 2.50-to-1

March 31, 2005 2.50-to-1

June 30, 2005 2.50-to-1

Sept. 30, 2005 2.75-to-1

Dec. 31 2005 2.75-to-1

March 31, 2006 2.75-to-1

June 30, 2006 2.75-to-1

Thereafter 3.00-to-1

Table 3: Ratio of EBITDA to senior debt service

Test dates EBITDA to senior debt service

Dec. 31, 2004 1.50-to-1

March 31, 2005 2.25-to-1

June 30, 2005 2.25-to-1

Sept. 30, 2005 2.25-to-1

Dec. 31 2005 2.25-to-1

March 31, 2006 2.25-to-1

June 30, 2006 1.00-to-1

Sept. 30, 2006 1.00-to-1

Dec. 31, 2006 0.65-to-1

March 31, 2007 0.65-to-1

Thereafter 1.00-to-1

Table 4: Ratio of total debt to annualized EBITDA

Test dates Total debt to annualized EBITDA

Dec. 31, 2004 7.00-to-1

March 31, 2005 7.00-to-1

June 30, 2005 6.75-to-1

Sept. 30, 2005 6.50-to-1

Dec. 31 2005 6.25-to-1

March 31, 2006 5.75-to-1

Thereafter 5.75-to-1

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