Zest Dental launches $320 million term loan at SOFR plus 575-600 bps

By Sara Rosenberg

New York, Jan. 26 – Zest Dental Solutions (Zest Acquisition Corp.) launched on Thursday its $320 million five-year senior secured covenant-lite first-lien term loan with price talk of SOFR plus 575 basis points to 600 bps with two 25 bps step downs at 0.5x and 1x inside closing first-lien net leverage, a 0% floor and an original issue discount of 95, according to a market source.

The term loan has 101 soft call protection for six months and amortization of 1% per annum, the source said.

Security is a perfected first priority lien on substantially all tangible and intangible assets and capital stock of the borrower and guarantors, limited to 65% of the capital stock of first tier foreign subsidiaries and subject to other customary exceptions.

Expected term loan ratings are B3/B.

Citigroup Global Markets Inc., SVB, UBS Investment Bank, RBC Capital Markets and Jefferies LLC are the joint lead arrangers on the deal. Citi is the administrative agent.

Commitments are due at noon ET on Feb. 2, the source added.

Proceeds will be used with cash from the balance sheet to refinance the company’s existing $252 million first-lien term loan and $115 million second-lien term loan.

Closing is expected in early February.

Zest is a Carlsbad, Calif.-based developer, manufacturer and supplier of solutions to treat both natural teeth and implant supported restorations.

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