By Lisa Kerner
Charlotte, N.C., Oct. 26 - Unilife Corp. subsidiary Unilife Cross Farm, LLC received two loans totaling $18 million from Metro Bank for the construction of Unilife's new corporate headquarters and primary manufacturing facility in York, Pa., according to a form 8-K filed with the Securities and Exchange Commission.
Loan proceeds will also be used to repay a $7 million bridge construction loan obtained from Univest Bank in August.
Cross Farm executed two term loan notes: the facility A note is in the amount of $14.25 million and has a 20-year maturity, and the facility B note is in the amount of $3.75 million and has a 10-year maturity.
The U.S. Department of Agriculture has agreed to guarantee $10 million of the loan, the filing said.
Cross Farm will pay monthly interest payments on the loans during the construction period at a rate based on the Wall Street Journal Prime Rate plus 150 basis points, with a floor of 4.5% per year.
Once construction is completed, Cross Farm will pay principal and interest payments on both facilities in consecutive monthly payments. The interest rate will be calculated at a fixed rate based on the five-year Treasury bill plus 300 bps, with a floor of 6% per year.
Beginning five years from the completion of the construction period, Cross Farm will make consecutive monthly payments at an interest rate negotiated between the parties. If no rate is negotiated, it will be based on the Wall Street Journal Prime Rate plus 100 bps, with a floor to be set not to exceed 250 bps over the prime rate.
One final payment of principal and interest is due on facility A 20 years from the completion of the construction period.
Cross Farm granted Metro Bank a mortgage lien and a continuing security interest in its personal property and agreed to maintain a $2.4 million debt service reserve.
The company may prepay the loan with a prepayment penalty in the amount of 2% during the first three years.
Unilife is a Lewisberry, Pa., medical device company.
| Issuer: | Unilife Cross Farm, LLC
|
| Guarantor: | U.S. Department of Agriculture (for $10 million)
|
| Issue: | Term loans
|
| Amount: | $18 million
|
| Maturity: | 10 years (for $3.75 million), 20 years (for $14.25 million)
|
| Coupon: | Varies
|
| Lender: | Metro Bank
|
| Settlement date: | Oct. 20
|
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