Solo Cup reprices term loan at Libor plus 200 bps

By Sara Rosenberg

New York, April 6 - Solo Cup Co. amended its term loan, lowering the interest rate to Libor plus 200 basis points from the previous Libor plus 225 to 250 basis points leverage-based grid pricing, according to an 8-K filed with the Securities and Exchange Commission.

The amendment also changed the amortization schedule to $1.625 million per quarter through Nov. 27, 2010, with a balloon payment of $606.125 million due on Feb. 27, 2011. By comparison, amortization was $1.625 million per quarter through Feb. 27, 2006, $6.25 million per quarter from May 27, 2006 through Feb. 27, 2008 and $12.5 million per quarter from May 27, 2008 through Nov. 27, 2010 under the original agreement, with a balloon payment of $449.5 million due on Feb. 27, 2011.

Lastly, the definition of consolidated EBITDA was modified, limiting non-recurring cash expenses incurred in connection with the integration of SF Holdings Group Inc. to $60 million for the 36-month period after Feb. 27, 2004 as opposed to the $30 million limit found in the original credit agreement.

The amendment was completed on March 31.

Bank of America is the administrative agent on the deal.

Highland Park, Ill.-based Solo Cup manufactures and distributes disposable foodservice and beverage-related products.

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