Charles River Laboratories amends $750 million term loan, revolver

By Susanna Moon

Chicago, Sept. 23 - Charles River Laboratories International, Inc. amended its credit agreement Friday with JPMorgan Chase Bank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The financing includes a $400 million term loan facility and a $350 million U.S. revolving facility. A portion of the facilities is available in euros to a Netherlands-based subsidiary of the company.

The term loan matures in 20 quarterly installments with the last installment due Sept. 23, 2016. The revolver is due Sept. 23, 2016 and requires no scheduled payment before maturity.

Interest on the loans will be Libor plus 100 basis points to 175 bps, and the commitment fee will be 20 bps to 35 bps, both based on leverage. The rate will initially be Libor plus 175 bps.

The facility was extended by one year.

In some circumstances, the company may increase the term loans and revolving line of credit by up to $250 million total.

In addition, Charles River is required to prepay the term loans with 100% of any net cash proceeds from permitted receivables financings and 100% of the net cash proceeds from certain debt, unless the leverage ratio is 2.25 times or less.

The amended terms also require the company to comply with an interest coverage ratio test and a leverage ratio test.

Negative covenants limit the ability of Charles River and its subsidiaries to incur, assume or permit to exist additional debt or guarantees, incur liens, make investments and loans, engage in mergers, acquisitions and asset sales, enter into agreements limiting subsidiary distributions, engage in certain transactions with affiliates and alter the business that they conduct.

Bank of America, NA is the syndication agent; RBS Citizens, NA, TD Bank, NA and Wells Fargo Bank, NA are co-documentation agents; and J.P. Morgan Securities LLC and Bank of America Merrill Lynch are joint lead arrangers and joint bookrunners.

Charles River is a Wilmington, Mass.-based provider of research models and associated services and of preclinical drug development services.

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