Highland Capital files term sheet for $52 million exit financing

By Sarah Lizee

Olympia, Wash., June 17 – Highland Capital Management, LP filed a term sheet for a proposed $52 million of exit financing Wednesday with the U.S. Bankruptcy Court for the Northern District of Texas.

As previously reported, Highland said it would identify an unaffiliated third-party lender for the loan. Blue Torch Capital LP was listed as administrative agent and lender.

The facility will consist of an up to $32 million senior secured term loan A and an up to $20 million senior secured term loan B.

The facility will mature in three years. Interest is Libor plus 700 basis points for the first two years, then Libor plus 800 bps in the third year. There will be a 1.5% Libor floor.

The facility includes a 1% upfront fee.

The facility is expected to close on July 1.

The proceeds will be used to repay subsidiary Trussway Industries’ term loan obligations in the approximate amount of $31.34 million, with the remainder of the credit facility to be used as working capital and to satisfy the obligations under the Chapter 11 plan, including the establishment of an administrative claims reserve and payment of allowed claims.

HCMLP is a Securities and Exchange Commission-registered investment adviser on Dallas-based Highland Capital Management’s global alternative investment platform. The company filed bankruptcy on Oct. 16, 2019 in the U.S. Bankruptcy Court for the District of Delaware. The case was later transferred to the Texas court under Chapter 11 case number 19-34054.

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