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Cenveo – Seeks Authority for Exit ABL Facility of $175 Million and Exit Term Facility of $236 Million

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August 14, 2018 – Cenveo requested authority to enter into commitment letters, and related fee letters, pertaining to the provision of exit financing, notably (i) for a fully underwritten $175 million commitment for a senior secured asset-based revolving credit facility (the “Exit ABL Facility”) and (ii) for a fully committed $236 million commitment for a senior secured first lien term loan credit facility (the “Exit Term Facility” and, together with the Exit ABL Facility, the “Exit Facilities”).

The motion attaches commitment letters in respect of each of the Exit Facilities and redacted versions of the fee letters as exhibits and summarizes the four letters as following: “(i) that certain commitment letter dated as of August 14, 2018, annexed as Exhibit 1 to the Order (the ‘Exit ABL Commitment Letter’), with Bank of America, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Bank, N.A., Citizens Bank, N.A., Barclays Bank PLC and JPMorgan Chase Bank, N.A. (collectively, ‘Exit ABL Commitment Parties’) for a fully underwritten $175 million commitment for a senior secured asset-based revolving credit facility, to be made available on the Effective Date (the ‘Exit ABL Facility’); (ii) that certain commitment letter dated as of August 14, 2018, annexed as Exhibit 2 to the Order (as amended, restated, supplemented or otherwise modified from time to time, the “Exit Term Commitment Letter” and together with the Exit ABL Commitment Letter, the ‘Exit Commitment Letters’), with certain members of the Ad Hoc First Lien Committee (collectively, the ‘Exit Term Commitment Parties’ and, together with the Exit ABL Commitment Parties, the ‘Exit Commitment Parties’) for a fully committed $236 million commitment for a senior secured first lien term loan credit facility (the ‘Exit Term Facility’ and, together with the Exit ABL Facility, the ‘Exit Facilities’); that certain (i) exit commitment agent fee letter dated as of August 14, 2018 with Bank of America, N.A. and Merrill Lynch, Pierce, Fenner & Smith Incorporated and (ii) exit commitment party fee letters dated as of August 14, 2018 with each of the Exit ABL Commitment Parties, each of which is annexed as Exhibits 3 to the Order, but are proposed to be filed in redacted form and in an unredacted form under seal (the “Exit ABL Fee Letters”) and (iv) that certain payments letter dated as of August 14, 2018 with the Exit Term Commitment Parties, which is annexed as Exhibit 4 to the Order, but is proposed to be filed in redacted form and in an unredacted form under seal (the ‘Exit Term Fee Letters’ and together with the Exit ABL Fee Letter, the ‘Exit Fee Letters’).

On August 9, 2018, Cenveo filed a Form 8-K which further describes the Exit Facilities, notably disclosing that, “The committed financing under the Exit Term Facility will be funded with original issue discount equal to 4.00% of the principal amount of the Exit Term Facility and will accrue interest at either a base rate plus a margin of 8.00% or the LIBOR rate plus a margin of 9.00%, which margins shall increase annually by 0.50% commencing with the first anniversary of the closing date of the Exit Term Facility and on each anniversary thereafter. In the event of certain prepayments of the principal of the Exit Term Facility, a prepayment fee will be payable to the lenders in an amount equal to (i) 3.00% of the principal amount prepaid if such prepayment is made prior to the first anniversary of the closing date of the Exit Term Facility, (ii) 2.00% of the principal amount prepaid if such prepayment is made on or after the first anniversary of the closing date of the Exit Term Facility, but prior to the second anniversary of the closing date of the Exit Term Facility, and (iii) 1.00% of the principal amount prepaid if such prepayment is made on or after the second anniversary of the closing date of the Exit Term Facility, but prior to the third anniversary of the closing date of the Exit Term Facility. Principal under the Exit Term Facility will amortize in an amount equal to 5.00% per annum of the original principal amount of the Exit Term Facility, with such payments commencing on June 30, 2019, and the Exit Term Facility will mature on the fifth anniversary of the closing date. In addition, the Company will make annual principal payments commencing with the year ending December 31, 2019 in an amount equal to 90% of the Company’s excess cash flow….The material terms of the Exit ABL Facility are being finalized and will be disclosed in advance of the Bankruptcy Court’s hearing to consider confirmation of the Plan of Reorganization. The Court scheduled an August 16, 2018 hearing to consider the Fee Letters and a related seal motion.

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The post Cenveo – Seeks Authority for Exit ABL Facility of $175 Million and Exit Term Facility of $236 Million appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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