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Carestream shops first- and second-lien term loan amend and extend
By Sara Rosenberg
New York, Dec. 11 – Carestream Health Inc. is in market with an amendment and extension of its first- and second-lien term loans, according to a market source.
The company is seeking to reduce its first-lien term loan (B1) to $720 million from $770 million, extend the maturity by 20 months to Feb. 28, 2021 and increase pricing to Libor plus 575 basis points from Libor plus 400 bps, the source said.
The extended first-lien term loan will have a 25 bps step-down in pricing if both corporate ratings are B3/B- or better, 101 hard call protection for life, amortization of 5% per annum beginning on Jan. 1, 2020 and a 75% excess cash flow sweep for life.
Regarding the company’s $372 million second-lien term loan (Caa2), the maturity will be extended by 18 months to June 7, 2021 and pricing will increase to Libor plus 950 bps from Libor plus 850 bps, plus 100 bps of PIK interest effective on Dec. 31, 2019, June 30, 2020 and Dec. 31, 2020, the source continued.
The extended second-lien term loan will have 101 hard call protection through Feb. 29, 2020, 102 hard call protection through June 30, 2020 and 103 hard call protection thereafter.
Both extended term loans will have a 1% Libor floor and total net leverage minimum liquidity and minimum EBITDA covenants.
Credit Suisse Securities (USA) LLC is the lead on the deal.
First-lien lenders are being offered a 100 bps extension fee, and second-lien lenders are being offered a 100 bps cash/100 bps PIK extension fee.
Commitments/consents are due at 5 p.m. ET on Thursday, the source added.
Carestream is a Rochester, N.Y.-based provider of medical imaging products and IT solutions.
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