Arris Group amends, restates $2.83 billion credit agreement via BofA

By Toni Weeks

San Luis Obispo, Calif., June 19 – Arris Group, Inc. entered into an amended and restated credit agreement on Thursday with Bank of America, NA as administrative agent, swingline lender and letter-of-credit lender, according to an 8-K filing with the Securities and Exchange Commission.

The amended credit agreement, which amends and restates the company’s existing credit agreement dated March 27, 2013, provides for senior secured credit facilities comprised of a $500 million revolving credit facility, a $990 million term loan A facility, an $800 million delayed-draw term A-1 loan facility and a roughly $544 million term loan B facility.

According to the filing, funding of the term loan A facility refinanced the term loan A facility under the company’s existing credit agreement, while the term loan B facility is a continuation of the term loan B facility under the existing facility. Funding of the term A-1 loan facility under the amended agreement will be available at the closing of the previously announced combination of Arris with Pace plc, and the term A-1 loan amounts will be sufficient to fund the cash component for the combination.

The amended credit agreement extends the maturity dates of the revolving credit facility and the term loan A to June 18, 2020. The maturity date of the term loan B remains April 17, 2020, and the term A-1 loan will mature on June 18, 2020.

Under the amended credit agreement, Arris will be required to maintain a minimum consolidated interest coverage ratio of not less than 3.5 to 1.00. The company will also be restricted by a maximum consolidated net leverage ratio of 3.75 to 1.00, which reduces to 3.50 to 1.00 on the first anniversary of the combination.

Royal Bank of Canada is the syndication agent, and Regions Bank is the senior managing agent. Bank of America Merrill Lynch, Fifth Third Bank, HSBC Securities (USA) Inc., PNC Capital Markets LLC, RBC Capital Markets, SunTrust Robinson Humphrey, Inc. and Bank of Tokyo-Mitsubishi UFJ, Ltd. are the joint lead arrangers and joint book managers.

Concurrently with the entry into the amended credit agreement, Arris terminated its credit agreement dated April 22, 2015 with Bank of America, as expected. There were no penalties paid by Arris in connection with the termination.

Arris is a telecommunications equipment manufacturing company based in Suwanee, Ga.

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