Digital Room cuts first-lien term loan to $110 million, raises pricing

By Sara Rosenberg

New York, Oct. 31 – Digital Room Inc. downsized its first-lien term loan to $110 million from $125 million and lifted pricing to Libor plus 600 basis points from Libor plus 550 bps, according to a market source.

In addition, the original issue discount on the first-lien term loan was changed to 98 from 99 and amortization was increased to 5% per annum from 1% per annum, the source said.

As before, the first-lien term loan has a 1% Libor floor and 101 soft call protection for six months.

Regarding the company’s second-lien term loan, it was minimally upsized to $47 million from $46.8 million.

Other changes made to the transaction included eliminating the incremental free and clear basket, adding a fixed charge coverage covenant in addition to the total net leverage covenant that was already part of the deal, and revising the excess cash flow sweep to 75% stepping down to 25% from 50% stepping down to 0%, the source continued.

The company’s now $167 million credit facility, down from $181.8 million, also includes a $10 million revolver.

BNP Paribas Securities Corp. is the lead bank on the deal.

Recommitments are due at 5 p.m. ET on Friday.

Proceeds will be used to refinance existing debt and fund a dividend, which was reduced to about $89 million from around $105 million as a result of the first-lien term loan downsizing, the source added.

Digital Room is a Van Nuys, Calif.-based owner and operator of online printing brands that produce a wide range of printed products.

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